Journal of Housing and the Built Environment

, Volume 28, Issue 2, pp 205-220

First online:

Open Access This content is freely available online to anyone, anywhere at any time.

Mortgage-equity release: the potential of housing wealth for future Dutch retirees


Interest in the use of housing wealth for future retirees is a topic of growing interest amongst policymakers and scientists. Owner-occupiers who are outright owners have lower housing expenses than tenants do, and they have substantial nest eggs. Mortgage markets leapt on this development and offers special products for the elderly, with which they could release their housing wealth. The question in this paper involves the extent to which households build housing equity (i.e. wealth) that could be released. This question is particularly interesting for the Netherlands, the country with the highest mortgage debt per capita in the European Union. This paper aims to combine two different theoretical debates: the debate on “the trade-off between owner-occupation and the welfare state” and the debate on the “life cycle theory”. It introduces the concept of the equity-to-value ratio, which is derived from the trade-off theory, and reveals the extent to which the people in the Netherlands accumulate housing wealth. This ratio shows that households do build equity. Further analysis indicates that this equity is not built as much by repaying the loan as it is by taking advantage of house price increases.


Housing wealth Retirement The Netherlands Mortgage market