ABN Amro has reported that it expects the price of housing in the Netherlands to increase yet again as demand goes up, this time by 8,5 percent in 2024 and a further 7 percent in 2025. However, the Dutch bank expects the number of transactions to slow as fewer newly built homes become available.
According to ABN Amro, Dutch residents had increased confidence in buying a home in the third quarter of this year due to wage increases and low mortgage interest rates. This meant that there was more competition in the housing market, and overbidding took place more often.
All these factors have led the bank to adjust its estimations for how much house prices will increase in the coming months. Previously, it had been predicted that the cost of homes would rise by 12,5 percent by the end of 2025 (7,5 percent in 2024 and 5 percent in 2025), but now expect a higher increase totalling 15,5 percent.
With prices of existing homes increasing faster than those of newly built homes, new homes are becoming more attractive, especially to families and retirees who can afford to move to the house of their dreams. These families then sell and move out of their existing homes, increasing the number of transactions of both types of housing.
However, the supply of newly-built homes is dwindling and despite more building permits being issued, many homes won’t be finished for several years. This suggests to ABN Amro that fewer homes will change hands as fewer homes are on the market.
“A positive development is that more existing homes are changing owners now that more and more rental homes are being sold,” stated Philip Bokeloh, ABN Amro housing market economist, alluding to the effects of the Affordable Rent Act and how more landlords are selling their properties. “This means that cheaper homes with a low energy label - usually apartments - are becoming available.”
First-time buyers can benefit from this the most, as long as they renovate and make the housing more sustainable. This has made apartments more popular as they are often more affordable than houses, especially in the bigger Dutch cities.