Large increase in underwater mortgages

Over 1.4 million Dutch households had a fiscal mortgage debt that exceeded the value of their own home on 1 January 2013. One year earlier this was true for 1.1 million households. Since the economic crisis began, at the end of 2008, the share of home owners with underwater mortgages has nearly tripled.

One in 3 home owners has an underwater mortgage

On 1 January 2013 close to 4.3 million households owned their own home. Most of them -83 percent- had a mortgage. A growing group of households has a fiscal mortgage debt that exceeds the value of the home. This fiscal mortgage debt does not include the amounts households have amassed in savings and investment-based mortgages.

In January 2008 some 13 percent of the Dutch home owners had underwater mortgages. This had risen to 34 percent by January 2013. The amount involved rose aswell: from an average of 52 thousand euros per household in January 2012  to 61 thousand euro at the start of 2013.

Households with a fiscal mortgage debt compared to the value of their home, 1 January

Fewer households with surplus value

Nearly 2.1 million Dutch households had home values that exceeded their fiscal mortgage debt in January 2013. This is about half of all home-owners. Their share has dropped considerably in the last six year. On 1 January 2008 some 73 percent of the home owners were in this position.

Some 720 thousand home-owning households have no mortgage debt at all. Their share increased by about 170 thousand from 2008 to 2011 and has remained stable ever since.

Mainly younger households underwater

In over two thirds of the homes with an underwater mortgage the home owners are younger than 45. They often bought their home right before the crisis and haven’t yet redeemed much of their mortgage. These younger households run the greatest risk of a residual debt when they need to sell their home.

Older households hardly face this problem. In January 2013 nearly 45 percent of the home-owners over 65 had no mortgage debt and  only 3 percent was underwater.

Households with a fiscal mortgage debt compared to the value of their home, by age of the main earner, 1 January 2013*

Noortje Pouwels-Urlings and Jeroen Nieuweboer