By: Raul_I_Meijer
While we’re all watching Spain and Greece, their alleged saviors in the rich core of the eurozone are starting to show serious signs of corrosion. This makes all the hollow words and promises coming from the world of troikas and politics sound even emptier than they already did. Not that anyone in Holland or Germany seems to even be prepared to think their economies are in for a big fall; for them, all the bad stuff is temporary, and soon it will all be better. Our proverbial Martian might be tempted to think denial is a river in northern EuropeTo wit: after a slew of reports on the housing situation in Holland earlier this year, by the Dutch government’s Central Statistics Bureau, the Dutch Central Bank and the Central Plan Bureau (CPB) – got to love the name -, the real estate sector itself issued a paper today, which, despite the obvious bias, makes everything look worse. Again.
As I wrote in Those Dutch Tulips Ain’t Looking All That Rosy last month, home prices in Holland rose some 20% annually around the turn of the century/millennium, for a total of 228% from 1985-2007.
On August 21, the Wall Street Journal reported that
The slump in the Dutch housing market deepened in July as prices posted the steepest drop on record, highlighting the challenges facing the Netherlands ahead of next month’s general elections. With prices now plumbing levels last seen in 2004, the downturn is weighing heavily on household consumption and has raised concern about the country’s huge mortgage debt pile, among the largest in Europe
House prices fell 8% from a year earlier, statistics bureau CBS said Tuesday, the largest decline in the 17-year history of the agency’s house-price index. Prices fell 4.4% in June and 5.5% in May. [..] House prices have fallen about 15% since their peak in August 2008 amid a stagnant economy, more stringent bank-lending criteria and weak consumer sentiment.
Today, the NVM (Dutch Real Estate Brokers Association) announced that among its members (good for 86% of transactions), Q3 sales were down 17.2% (!) from Q2. Home prices fell 2.2% from that quarter, and 7.5% from Q3 2011. Average home prices are now down 21% compared with 2008, from €265,000 to €209,000. 700,000, or over 20%, of Dutch homeowners are now underwater. The NVM expects 100,000 homes to be sold in 2012, and labels this the “absolute bottom”.
Full article at source: http://www.marketoracle.co.uk/Article36968.html
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