Personal capital drops sharply

Dutch personal capital was one fifth lower on 1 January 2010 than at the beginning of 2009. This is mainly the result of the lower value of own homes and a slight increase in mortgage debts. The reduction in capital was relatively larger for employees than for the self-employed.

Lower house values, higher mortgage debt

At the start of 2010 the median capital of Dutch households was 33 thousand euro. Twelve months previously this was still 42 thousand euro. The decrease was mainly caused by a reduction in the values of own homes in 2009. Nearly six in ten households owned their homes. On 1 January 2010 the value of this home was 237 thousand, down from 254 thousand at the beginning of 2009. In addition, the mortgage debt rose from 150 thousand euro in 2009 to 155 thousand euro in 2010. Other debts also rose, from 31 to 35 thousand euro.

Personal capital, value of own home and mortgage debt (average)

Securities worth more

The value of securities such as shares and bonds rose by 15 percent in 2009 to 13 thousand euro on 1 January 2010. Nearly one quarter of households owned shares and bonds. On 1 January 2010 households had 14 thousand euro in savings, compared with 15 thousand euro in 2009, a fall of 8 percent. Nearly everyone has a bank or savings account.

Average amounts of personal capital components on 1 January 2010

Reduction in equity largest for employees

The equity of households which depended on labour for their main income fell by nearly one third in 2009 and was 25 thousand euro on 1 January 2010. Self-employed people also saw their capital shrink, but by relatively less. Their capital fell to 154 thousand euro at the beginning of 2010. Twelve months previously it was still 168 thousand euro.

Among households on benefits, the unemployed ate into their capital substantially, resulting in a drop from 15 thousand euro on 1 January 2009 to 4 thousand euro one year later. The equity of households dependent on old age pension or survivors’  benefit rose on the other hand.

Average amounts of capital by household’s main source of income on 1 January

Jack Claessen