So, there are risks, but, from the ECB’s point of view, they are not too pronounced. In addition, the euro area economy is recovering, and this will help to alleviate some financial stability concerns. That said, the situation differs from country to country, of course. And as this is Dutch Banking Day, let’s turn our attention to the Netherlands.
There are two things in this country that the ECB is watching closely. The first is the real estate sector. Since 2013, prices for residential real estate have been rising strongly. This applies mostly to large cities, where we now see tentative signs of overvaluation. Prices increased faster than household income. But mortgage lending is still growing more slowly than house prices.