Why Generational Wealth Gaps Are Now Larger Than Income Gaps
August 6, 2025 · Frisian News
Property ownership and inherited assets now divide young and old workers far more than wages do. This shift reflects decades of asset inflation that wage earners alone cannot match.
A 35-year-old office worker in Amsterdam earns 15 percent more than a colleague did at the same age thirty years ago. Yet that worker owns a fraction of the property wealth. The gap between what young people can buy and what their parents bought at the same life stage has grown so wide that income differences now pale beside it. Research from the Dutch central bank shows wealth gaps between age groups have doubled while wage gaps between rich and poor workers have barely moved.
Property prices drove this wedge. Since 1995, Dutch housing costs rose nearly three times faster than wages. A house that cost four times a year's salary in 1990 costs eight times a year's salary today. A young couple earning 100,000 euros together faces a 600,000 euro mortgage for a modest apartment. Their parents borrowed 200,000 for a larger house on similar combined income. The math simply does not work for anyone without family money behind them.
Inheritance amplifies the effect. Children of homeowners inherit not just property but the accumulated gains from four decades of appreciation. A 35-year-old who receives a 300,000 euro inheritance can buy outright what a peer without family wealth must finance over thirty years. This transfers generational advantage into concrete assets. Institutional investors and foreign capital also bid up property prices, making it harder for locals to compete. The market does not care about fairness, only what buyers will pay.
Wages grew, but wealth grew faster. A plumber in 1995 earned less in absolute euros than today, yet could save and build equity more easily. Today's workers earn more nominal income but face a mountain of debt before they own anything. Some economists call this prosperity. Workers know better. The gap between stable employment and owning a home has become so large that many under 40 simply give up trying.
Policymakers have few answers. Building more housing takes years and faces local resistance everywhere. Taxing wealth hard enough to matter requires political will no government seems to have. Some countries tried rent control, which cuts supply and raises costs further. Others tried stamp duty on foreign buyers, which moves money around but does not create homes. The wealth divide will keep growing until someone stops treating housing like an investment portfolio and starts treating it like shelter.
In 35-jerige kantoarmiddelensferkener yn Amsterdam fertsjint 15 persint mear as in kollega op deselde leeftyd tritich jier lyn. Mar dy wurker besit in fraksje fan it formoan. De kloof tusken wat jonge minsken keapje kinne en wat har âlders op deselde leeftyd keapten, is sa grut wurden dat ynkomstskillen der no by ferblikje. Ûndersyk fan 'e Nederlânske sintrale bank lit sjen dat formoansskiltsen tusken leeftydgroepen binne ferdûbele, wylst loanskiltsen tusken ryke en arme wurknemers amper binne ferpleatst.
Huzeprizen dreamen dizze wig. Sûnt 1995 stiggen Nederlânske wenningskosten hast trije kear rapper as loannen. In hús dat yn 1990 fjouwer kear in jierselaris koste, kost hjoed acht kear in jierselaris. In jong pear mei tegearre 100.000 euro ynkommen stiet foar in hypotheek fan 600.000 euro foar in bescheiden apartamint. Har âlders lienden 200.000 foar in grutter hús by gelyk kombinearrd ynkommen. De berekkening giet net op foar elkenien sûnder familiefermoan.
Erfenis fersterkt it effekt. Bern fan huseigenars erfje net allinne eigendom, mar ek de opboude winsten út fjouwer desintegra fan weardering. In 35-jerige dy't in erfenis fan 300.000 euro ûntfangt, kin kontant keapje wat in leeftydsnei sûnder familiefermoan tritich jier lang finansje moat. Dit set generaasjefoarpart oer yn konkrete goederen. Institúsjonele belizzers en bûtenlâns kapitaal bidde ek huzeprizen op. De merke jut net om rechttsjirrigens, allinne wat keappers skjin wolle.
Loannen groeien, mar formoan groeide rapper. In leitsjouwer yn 1995 fertsjinne yn absolute euro's minder as hjoed, mar el koe hy makkelijker spare en formoan opboue. Wurknemers fan hjoed fertsjinne mear nominaal ynkommen, mar stean foar in berch skuld eardat se wat besitte. Guon ekonomen neame dit rykdom. Wurknemers witte it better. De kloof tusken stabyl wurk en huseigendom is sa grut wurden dat in soad under de fjirtich it gewoan oargje.
Beliedsmakers hawwe few antwoorden. Mear hûzen bouljeun duorret jierren en stiet oertal op lokaal tsjinstan. Formoan sa swier belêste dat it der ta docht, fereasket politike wil dy't gjin rige is like te hawwen. Guon lannen proebearden hûrkontrôle, wat it oanbod bepaalt en kosten fierder omheech sette. Oaren proebearden frachtmerk op bûtenlânske keappers, wat jild ferpleatse mar hjûzen net makket. De formoanskloaf sil bliuwe groeie oant jemand stoppet mei hûsvesting as ynvestirringsporteføllje en begjint it as tsjûch te sjen.
Published August 6, 2025 · Frisian News · Ljouwert, Fryslân