Monday

27th Mar 2017

ECB: German households less wealthy than Cypriots

  • Berlin graffiti - Germany's economic powerhouse image masks realities of average people (Photo: Valentina Pop)

Luxembourg tops the ranking of Europe’s wealthiest households followed by Cyprus while Germany is at the bottom, according to a survey report released by the European Central Bank on Tuesday (9 April).

The survey spans 15 member states and looked at, among other things, the median net wealth of 62,000 households.

Dear EUobserver reader

Subscribe now for unrestricted access to EUobserver.

Sign up for 30 days' free trial, no obligation. Full subscription only 15 € / month or 150 € / year.

  1. Unlimited access on desktop and mobile
  2. All premium articles, analysis, commentary and investigations
  3. EUobserver archives

EUobserver is the only independent news media covering EU affairs in Brussels and all 28 member states.

♡ We value your support.

If you already have an account click here to login.

Most of the data was collected in 2010 but some was gathered in 2008 like in Spain when the housing bubble had artificially inflated prices.

The same houses in Spain are worth much less today, Christoph Schröder from the Institute of the German Economy in Cologne told Spiegel Online.

The 113-page report looks at a range of indicators and notes that a number of caveats may distort results.

“The data for Cyprus appear not to be comparable with those for other euro area countries in a number of dimensions and should therefore be interpreted with caution,” says the report.

The report says the differences between Cyprus and other euro area countries “emanate to a large extent from historical, cultural, and institutional factors”.

Inheritances, intergenerational transfers, household composition, land ownership and allocation of household wealth between real and financial assets differ widely across the surveyed member states.

But among homeowners, the household main residence constitutes by far the most valuable asset, notes the report.

The median net wealth of homeowners across the countries surveyed is €241,200. Those with a mortgage report a median figure of €171,100, while those renting have a median net wealth of €9,100.

People in southern European countries tend to own their homes and are more likely to operate a small business unlike in Germany where more people have part-time contracts and are more likely to rent.

Less than 50 percent of Germans and Austrians own their own homes. The large role of public housing in Germany also contributes to lower home ownership rates,

“The low home ownership rate in Germany is in part due to the construction of social housing after World War II and in part due to taxation of owner-occupied housing and the lack of tax deductibility of interest payments on mortgages,” notes the report.

Meanwhile, households with more adults like in Cyprus, Malta and Slovakia also tend to accumulate more wealth related to real-estate than smaller households found more often in the Netherlands, Austria or Finland.

Given the comparative differences, German household net wealth comes out to around €51,400 compared to Cyprus at €266,900 and Luxembourg at €397,800.

Greece ranks in at €101,900, France at €113,500, and Spain at €182,700.

“It should be kept in mind that the survey focuses on one particular type of wealth, i.e. wealth of private house holds,” says the report.

ECB steps in, vows help 'as long as needed'

The ECB has lowered its key interest rate to a record low and vowed to take more action "if necessary," in a move aimed at alleviating recession and unemployment in the eurozone.

SMEs lack support in EU financial plan

The European Commission's plan for a capital markets union is said to be aimed at small and medium-sized enterprises, but many could end up being left out in the cold.

Eurozone chief in 'drinks and women' row

[Updated] The Netherlands' Jeroen Dijsselbloem faces calls for resignation after saying that crisis-hit countries in southern Europe spent "money on drinks and women" before being helped by others.

Stolen Russian billions ended up in EU states

Illicit money flowing out of Russia ended up in almost every single EU state, an investigation has found, posing questions on the integrity of Europe’s banking systems.

Stakeholders' Highlights

  1. Belgrade Security ForumCall for Papers: European Union as a Global Crisis Manager - Deadline 30 April
  2. European Gaming & Betting Association60 Years Rome Treaty – 60 Years Building an Internal Market
  3. Malta EU 2017New EU Rules to Prevent Terrorism and Give More Rights to Victims Approved
  4. European Jewish Congress"Extremists Still Have Ability and Motivation to Murder in Europe" Says EJC President
  5. European Gaming & Betting AssociationAudiovisual Media Services Directive to Exclude Minors from Gambling Ads
  6. ILGA-EuropeTime for a Reality Check on International Day for the Elimination of Racial Discrimination
  7. UNICEFHuman Cost to Refugee and Migrant Children Mounts Up One Year After EU-Turkey Deal
  8. Malta EU 2017Council Adopts New Rules to Improve Safety of Medical Devices
  9. Nordic Council of MinistersNordic Energy Research: How to Reach 100 Percent Renewable Energy
  10. Party of European SocialistsWe Must Renew Europe for All Europeans
  11. MEP Tomáš ZdechovskýThe European Commission Has Failed in Its Fight Against Food Waste
  12. ILGA-EuropeEP Recognises Discrimination Faced by Trans & Intersex People