Overheated Amsterdam housing market driving Dutch pricetags higher
The so-called "Amsterdam effect" accounts for a quarter of the increase in housing prices in the Netherlands, according to Rabobank in its quarterly report of the Dutch housing market. Without the overheated Amsterdam market, the average house price would have increased by 3.4 percent in the second quarter, compared to the previous year, and not 4.4 percent as happened, ANP reports.
Over the last 20 years Amsterdam's share of the Dutch housing market increased from 2 to 9 percent. In the same period the turnover of Amsterdam home sales rose from 280 million euros a year to 4.3 billion euros per year.
According to Rabobank, the house prices in the Netherlands will grow by 5 percent this year and next year. The increase in the number of sold homes will level out to between 200 thousand and 220 thousand homes in 2016 and 2017, according to the market experts. This is because construction is lagging behind the rising demand in the housing market.