Homes becoming increasingly affordable, demand remains high, says Rabobank
Dutch homes are expected to become increasingly affordable, while demand remains high, said Rabobank researchers in a quarterly report published on Tuesday. They think that the housing market will ultimately stabilize next year.
The economists considered many factors, including the limited number of homes on the market, which is offset by the better affordability of owner-occupied homes. "Due to rising incomes, home buyers will be able to borrow approximately as much in 2024 as before interest rates started to rise, while home prices have actually fallen," explained RaboResearch economist Nic Vrieselaar.
"Moreover, although the economy is cooling down somewhat, we assume that unemployment will remain low. Demand for owner-occupied homes is therefore expected to remain relatively high."
The Rabobank researchers expect that housing prices will be an average of 5.2 percent lower this year than in 2022. "That is slightly more than we assumed in our previous quarterly report, when we predicted a fall in house prices of 4.2 percent. percent," said Vrieselaar. "But prices have fallen slightly more than we previously expected, and the economic picture has also become slightly more negative."
In addition, it is expected that 165,000 homes will get a new owner, far less than last year's 193,000. This is partly due to the fact that fewer new homes are being built, which leads to fewer sales. The Rabobank researchers observed that young adults in particular are still buying a relatively large number of homes, in contrast to those over 35.
But that does not mean that people in their twenties and thirties have increased their share of home ownership. "Compared to the total number of under-35s in the Netherlands, they are now buying fewer homes than in recent years, while in recent years, historically few young adults bought a home, and home ownership among people in their twenties and thirties fell sharply," said Vrieselaar.
The researchers also believe that housing prices will fall in all regions, although the pace at which this will happen differs by area. For example, home prices in the northern part of Limburg, Zeeland and parts of Overijssel may fall by 3 percent compared to last year. In the vicinity of Utrecht and Amsterdam, prices could drop by 8 percent.
Reporting by ANP