Higher interest rates slowing down home sales

The higher mortgage interest rates may be cooling the Dutch housing market down further. Home prices fell on a quarterly basis in the first months of the year, the supply of existing homes is increasing, and the number of sales is dropping, AD reports based on figures from parties in the housing market.

According to the realtors' association NVM, house prices fell by 2.1 percent in the first quarter of this year, compared to the previous quarter. Figures from the housing platform Funda show that the supply of existing homes increased by 67 percent since January and that the number of sales is decreasing.

Makelaarsland, one of the Netherlands' largest real estate agencies, told the newspaper that the number of house viewings has been falling for five consecutive months. Between April and June last year, there were an average of 13.1 viewings per month. Over the past few months, that fell to 7.8 viewings per home. The number of bids is also falling, from 6 per home last year to 4.6 now on average.

As the competition for buying a house decreases, so does the tendency to overbid, Malekaarsland added. In June last year, 88.3 percent of homes sold above the asking price. This month that happened in 70.9 percent of sales. The overbid amount is also decreasing. Makelaarsland is currently selling about a third of homes at or below the asking price.