Dutch home price increases slowing down as supply rises: realtors

The number of homes for sale in the Netherlands increased sharply last quarter, and the rise in house prices is slowing down. According to real estate agents, these developments make it easier for home seekers to buy a house. On the other hand, mortgage interest rates are rising, and the amount people can borrow is decreasing.

All this emerged from the quarterly report of the Dutch Association of Real Estate Agents (NVM). Real estate agencies affiliated with the NVM had over 25,300 homes for sale at the end of June, 42 percent more than a year ago and over half more than the first quarter.

“I am positive about the somewhat wider range of housing,” said Lana Gerssen, realtor and chairman of the Housing department of NVM. “We’ve had to sell ‘no’ to too many interested candidate buyers for too long, and that frustrates everyone enormously. The absolute madness seems to be easing this quarter.”

She pointed out that, on average, there were also fewer viewings per home and that interested parties made less extreme offers. “Yet a healthy balance between supply and demand is still hard to find. In the second quarter, eight out of ten homes were still sold above the asking price.”

An existing home cost an average of 448,000 euros last quarter. That is 3.5 percent more than in the first three months of the year. The slight fall in house prices compared to the end of 2021 that realtors noticed in the first quarter, therefore, did not continue in the second quarter.

But compared to a year ago, the price increase was less steep. On an annual basis, existing home prices increased by 10.6 percent, whereas increases of over 20 percent were measured in previous quarters.

NVM brokers sold almost 36,000 existing owner-occupied homes in the second quarter. That is 24 percent more than in the previous quarter but still 1 percent less than compared to the second quarter of last year.

According to Gerssen, fewer than 5,000 newly built homes were sold in the second quarter. “That is almost half less than a year earlier,” she said. According to her, the new construction is still too limited to apartments in cities. “Buyers’ demand is mainly for single-family homes, but these are unaffordable for a growing group due to the sharply increased construction and land costs. We therefore still have a way to go.”