COVID-19 and the Mortgage Market in Luxembourg
With a ratio of household debt to gross disposable income above 150%, households in Luxembourg are among the most indebted in Europe. A high level of debt exacerbates the sensitivity of household net worth to changes in house prices, which can increase the severity of economic downturns. In this note, we evaluate the implications of the COVID-19 crisis for the mortgage market in Luxembourg using data on the labour market and government interventions, as well as surveys of consumer finances (HFCS). Our conclusions are twofold. At the aggregate level, the Luxembourg mortgage market is relatively... Mehr ...
Verfasser: | |
---|---|
Dokumenttyp: | Artikel |
Erscheinungsdatum: | 2022 |
Reihe/Periodikum: | Journal of Risk and Financial Management, Vol 15, Iss 114, p 114 (2022) |
Verlag/Hrsg.: |
MDPI AG
|
Schlagwörter: | COVID-19 / household finance / real estate market / mortgage market / Risk in industry. Risk management / HD61 / Finance / HG1-9999 |
Sprache: | Englisch |
Permalink: | https://search.fid-benelux.de/Record/base-26740538 |
Datenquelle: | BASE; Originalkatalog |
Powered By: | BASE |
Link(s) : | https://doi.org/10.3390/jrfm15030114 |
With a ratio of household debt to gross disposable income above 150%, households in Luxembourg are among the most indebted in Europe. A high level of debt exacerbates the sensitivity of household net worth to changes in house prices, which can increase the severity of economic downturns. In this note, we evaluate the implications of the COVID-19 crisis for the mortgage market in Luxembourg using data on the labour market and government interventions, as well as surveys of consumer finances (HFCS). Our conclusions are twofold. At the aggregate level, the Luxembourg mortgage market is relatively well placed to weather the shock, because a large share of residents work in sectors that are less affected by the crisis such as the financial or government sectors. However, our analysis of micro-level survey data suggests that some segments of the population may be financially vulnerable to the COVID-19 shock.