Milestones in European housing finance

Twenty-five years ago, housing finance markets hardly existed in many European countries and where they did, they had been heavily regulated. The position started to change in the 1970s and in one or two countries there was significant liberalisation in the early 1980s. But the shift towards a new set of actors and new instruments did not really gain momentum until later in the decade. Thereafter, at global and European levels, there were periods of growth followed by crisis in the late 1980s and early 1990s, jitters for some in the mid/late 1990s and a period of stable growth followed by the Global Financial Crisis of 2008/09 from which markets are only just recovering.
Milestones in European Housing Finance provides evidence on how housing finance markets developed across Europe; which countries followed particular trends and the fundamentals that lay behind the different patterns in order to examine the lessons that can be learned from past experience and likely future trajectories. It offers detailed evidence and analysis across countries from local commentators filling a gap that is currently only being filled by national analyses or international commentators.

The editors have brought together up-to-date material from across Europe to help clarify:

how national housing finance markets have dealt with the challenges of deregulation and privatisation since the 1980s

how the financial crisis has impacted on the structure of the industry and the range of financial instruments available

how governments and the EU have responded to increasing risks and higher indebtedness in most West European countries and the need to grow new finance markets in Eastern Europe

how changing housing finance markets affect the capacity to provide adequate affordable housing into the future

The 25 chapters cover developments in countries across Europe, together with Australia as a comparator, and focus on understanding the sources of private sector finance for owner-occupation. In countries where the private finance market for social and private rental housing is well developed, this will also be discussed. For each country, the major milestones in the development of the market over the last 25 years are identified and examined. The chapters also look to understanding the efficiency and effectiveness of these national markets into the future.

Three overarching chapters by the editors provide: the economic and housing market context in which financial change has taken place; an analytic framework to provide a basis for drawing out lessons for the European and global markets in finance and housing; and a concluding chapter bringing the lessons together to point to the future role of private housing finance, particularly as demographics and incomes change and housing wealth is realised for other purposes. The book also includes a chapter clarifying the milestones in European Union regulation, which have become an ever increasing irritant in national housing markets over the last two decades.

Jens Lunde, Department of Finance, Copenhagen Business School, has been Associate Professor in the Department of Finance at Copenhagen Business School since 1984. He previously taught in the Department of Economics at the University of Copenhagen and worked for the Danish Ministry of Housing and the Danish Building Research Institute. His main specialisms are in housing finance with a particular emphasis on the analysis of individual data.

Christine Whitehead is Emeritus Professor in Housing Economics, Department of Economics, London School of Economics and works mainly in the fields of housing economics, finance and policy. She has worked with a wide range of international agencies as well as regularly for the UK Government and Parliament.