Home sales to keep falling next year due to slow new construction: ABN Amro

The number of home sales will not increase next year as previous forecasts expected. According to ABN Amro, which previously assumed growth of 2.5 percent, the number of transactions will decrease by that same percentage in 2024. According to the bank, this is due to the lagging completion of new construction projects.

ABN Amro expects affordability to improve very gradually and indirectly through wage increases. “Because this takes time, the number of transactions will likely remain low.” ABN Amro expects 5 percent fewer transactions this year than last year.

The bank does see that the most significant fall in house prices is nearing its end. Previously, it expected a price drop of 6 percent for this year, which it has now adjusted to a minus of 5 percent. Next year, according to the forecast, there will be a further decrease of 3 percent.

According to ABN Amro, “the end of the price correction is in sight.” Homes have become more expensive in recent years, especially in large cities. Since the peak last year, there has been a sharp price drop, which can mainly be observed in the larger towns. “In addition, it is mainly older homes with a low energy label that are undergoing price correction, while the valuations of homes with a favorable energy label have risen,” the bank reports.

According to Philip Bokeloh, housing market economist at the bank, relief in the housing market is not yet really in sight. “There is a great shortage of homes, and this problem threatens to worsen due to the construction industry's difficulties. Unfortunately, the fall of the Cabinet does not contribute to a solution to this problem,” he explained.