in a nutshell...
Dutch housing market is showing the first signs of a gradual recovery, house
sales are increasing. This also results in a growing demand for mortgages.
Since mortgage lending and funding by domestic parties has been constrained,
demand may exceed supply, offering opportunities for foreign investors.
mortgage market offers possibilities for foreign banks and investors to supply
new mortgages directly to consumers, or to invest in mortgages through RMBS or
covered bonds. The government promotes entry of new parties to the mortgage
market, in order to increase competition and lower interest rates.
LTV’s are relatively high, arrears and defaults on mortgage payments by
borrowers are very low. Additionally, the government is taking a number of
steps to curb high LTV’s, reduce credit risks for consumers and banks and
increase transparency in the mortgage market.
As a result
of recent legislation and further supervision, the Dutch mortgage market has solid
fundamentals. The variety of products is reduced as a result of fiscal changes
to annuity and linear mortgages. The repayment of the total mortgage debt is
increasing as a result of temporary measurements implemented by the government.
As a result
of the lack of competition in the Dutch market, the interest rates are
relatively high. Dutch banks have to de-risk as a result of Basel 3 and AQR,
further legislation will influence the ratio’s for Dutch banks negatively. This
will lead to less active competition and more room for foreign investors.
economy is one of the most stable and open economies in Europe. An economy with
one of the highest GDP’s per capita.
the Netherlands exited its third recession since the global financial crisis
started in 2008. Gross domestic product grew 0.7 percent in the fourth quarter,
the most since 2010.
is expected to grow 0.75 percent in 2014 and 1.25 percent next year, driven by
exports and investments, the government’s planning agency CPB said in March. It
sees the national budget deficit at 2.9 percent of GDP this year, narrowing to
2.1 percent in 2015.