In developed countries, most resident houses are purchased by loans on the mortgage, thus leading to negative saving
and forced saving by borrow money to buy houses from the point of essence.
In fact Cyprus is the only EU member where households have recorded negative saving
rates since 2014.
Notice both buildings have negative saving
numbers in some months, which indicates the buildings consumed more electricity in those months than they would consume if they were operated in the same manner as during pre-retrofit period.
The average difference was about 0.3 percentage point, reflecting a negative saving
rate by nonprofit institutions serving households for each year except 2005.
How quickly consumers move from the negative saving
rate of 2005 to something closer to the 10 percent saving rate of a few decades ago will determine the timing and severity of the next recession.
Therefore, if the housing price-to-income ratio remains constant over time despite growing housing prices and permanent income, then different age cohorts (except the homebuyer cohort) have the same saving rate, whereas the homebuyer cohort always has a negative saving
rate that offsets the positive savings of the other cohorts.
In another words, the government's negative saving
is financed by the private sector's positive savings.
But it is worth noting that the boom that preceded the present downturn was not an overnight occurrence; it gathered pace over a decade of negative saving
and underinvestment - particularly in the US - along with certain corrupt practices that were readily tolerated in the midst of the "boom" period.
* The high levels of consumption associated with negative saving
appear to have been sustained by equity withdrawal from housing and farms, which in recent years has been large.
When the public sector runs a budget deficit, it has a negative saving
rate and reduces national saving.
(6) Over one-half of total household savings over the 15 year period are generated by those in the richest decile of households, while the three lowest income decries contribute negative savings
. Of course, not all households in these lower income groups have negative saving
rates, as shown by the saving rates at the 75th percentile within these three decries.