Madness on Dutch housing market continues as homeowners are scared to sell
Prices of owner-occupied homes continue to rise sharply, realtors' association NVM said in its quarterly report. On average, existing home prices increased 19 percent in the third quarter compared to the same period last year. The price for a newly built home rose by 14 percent on an annual basis. In addition, the housing supply fell by 44 percent in one year.
The average selling price for an existing home increased to 419,000 euros in the past months. A newly built home cost 455,000 euros on average. The NVM also noted that the number of homes sold in the Netherlands decreased again. A total of 32,000 houses were sold, a 29 percent year-on-year decline and the lowest number in six years. At the end of the quarter, 16,500 homes were for sale. That is the lowest number since measurements started in 1995.
According to the NVM, dissatisfaction among home seekers continues to increase. Mainly because when bidding on a house, the asking price gets amply outbid. About 80 percent of homes are sold above the asking price. NVM director Onno Hoes, therefore, spoke of "not a bright picture." According to the realtors, the extremely low mortgage rate is partly responsible for the madness on the housing market. In addition, private individuals have higher savings than ever, and the economy is developing strongly. According to the NVM, this gives home buyers the confidence to "consciously" offer the top price to trump other buyers.
Hoes explained that it can be beneficial for house sellers to monetize the equity now. But to find a suitable home afterward will be quite the task. It makes people think twice before putting their house up for sale. According to Hoes, this hinders the flow, not only in the owner-occupied market but also between rent and purchase. It also increases the dichotomy in society between homeowners and home seekers.
The average asking price of all homes that are now for sale amounts to 480,000 euros. That represents an increase of 6.4 percent compared to the third quarter of 2020 - a leveling off. That percentage has long been above 10 percent. On average, a house is on the market for 45 days - over a month shorter than the third quarter last year.
In addition, NVM brokers sold almost 8,000 newly built homes and building plots in the third quarter. That represented a 15 percent decrease compared to a year earlier. The number of newly built homes that came on the market fell by 28 percent to 7,400 homes.
Reporting by ANP