Amsterdam - Dutch home-buyers were hoping for extra financial support with the government expected Friday to approve of expanding the conditions of an existing special insurance for home owners. The insurance guarantees that the mortgage will be paid if - under certain circumstances - the owners can no longer meet their financial obligations.
At present, only people who buy a home of up to 265,000 euros (368,000 dollars) have been able to apply for this type of insurance.
The insurance has existed for many years and was originally made to help low-income and young people who want to buy a home.
But speaking in parliament on Wednesday, Finance Minister Bos gave in to ongoing demands from lawmakers requesting him to expand the conditions to include homes of up to 350,000 euros.
This would enable most middle-class Dutch nationals to purchase a home with the insurance. The new measure is meant to stimulate the residential real estate market which has come to a near-standstill.
In the first three months of 2009, Dutch home prices fell by 3.1 per cent, marking the third consecutive quarter of price drops.
The volume of sales dropped dramatically from 33,000 in the first quarter of 2008 to 19,000 in the same quarter this year. The demand in new homes fell more than 70 per cent.
