Tag Archives: housing bubble

Something else: the Dutch economy and a possible housing bubble deflating?

As I am Dutch, i do follow the Dutch news to some extent. I found some news that kind of confirmed that things are not so well in one of the ‘core’ core eurozone countries:

The other Dutch disease Although this is already a month old it seems that the Dutch economy is hit harder by the eurocrisis than the German economy.

Dutch show how not to run housing policy And this is one of the reasons why. Now, since 2011 housing prices have dramatically declined, but thanks to the earlier problems of the Dutch financial sector, the banking sector is now simply stuck – banks don’t lend money, so people can’t buy, which means it is impossible to sell, which makes it a problem that people have expensive mortgages from the time of rising housing prices.

Also exports and imports through Rotterdam are not as big as previously, and as a whole, the Netherlands is quite sensitive to changes in the European economic tide. On top of that are issues like transport (traffic jams).

I don’t know if the Netherlands will lose its AAA-status but it nonetheless starts to feel uncomfortable for the current government that they aligned themselves with Merkel’s economic policy and wholly supported the new Fiscal Compact.