The government’s new financial advice council says home owners should only be able to borrow 90% of the value of their homes in order to prevent a re-occurrence of the negative equity crisis.

Home buyers can currently borrow up to 103% of the value of the property to cover essential costs.

The Financial Stability Committee, which is chaired by central bank president Klaas Knot, has drafted its recommendations for finance minister Jeroen Dijsselbloem and they will be sent to parliament today, broadcaster Nos reports.

Knot says in Thursday’s Volkskrant that the 100% limit the government is proposing to introduce from 2018 does not go far enough and is out of step internationally. ‘These high mortgages mean both banks and households are very vulnerable financially,’ he said.

Three years ago Knot made a similar call for a reduction in the maximum mortgage value, which was not welcomed by political parties.

The change would mean home buyers will have to save 10% of the purchase price of their property as well as thousands of euros to cover the costs.

Around 25% of home owners are now in negative equity, Rabobank economists said earlier this year. That is just under one million households, down from 1,070,000 in 2013 when the housing crisis was at its height.