Worrying lack of new housing construction in Amsterdam region; Permits down 40%

Despite ambitious plans to build more homes, housing construction in the Amsterdam Metropolitan Area is in freefall. The number of construction permits granted in the first half of this year fell significantly compared to previous years, and the number of newly-built homes delivered is also decreasing, according to a report by platform Nul20 based on figures from Statistics Netherlands (CBS).

In the first half of this year, 2,910 construction permits were granted in 29 municipalities that make up the Amsterdam Metropolitan Area (MRA), which is 38 percent less than the 4,722 granted in the first half of 2022. In the first half of 2021, the MRA granted 6,552 permits for housing construction, and in 2020, 5,681.

The number of housing construction permits issued is a good indicator of how many homes will be built in the coming period. The CBS figures on construction permits may not always be reliable in absolute terms and may also be erratic per quarter, Nul20 pointed out. “But the trend is undeniably very negative.”

The number of homes built per year is also decreasing. According to Nul20, about 12,000 new homes will be built in the MRA this year, compared to over 15,000 last year. According to the Housing Deal the government made with municipalities earlier this year, the MRA needs around 22,500 new homes per year to solve the current housing shortage.

Nul20 pointed out that the city of Amsterdam still managed to build homes on target in the first half of this year, adding 4,238 new homes in the first six months of this year on an annual goal of 7,500. However, most of these homes were already under construction before Russia invaded Ukraine, triggering deteriorating market conditions like declining consumer confidence, rising interest rates, and more expensive raw materials.

“We will have to do better in all areas,” Haarlem alderman Floor Roduner told AT5 on behalf of the MRA. According to Roduner, the fact that things are looking worse, not better, six months after the Housing Deal has two leading causes. “The construction market has really deteriorated, mainly due to interest rate increases and expensive raw materials. Projects that were financially complete are now in trouble. In addition, the Cabinet has collapsed. The Housing Deal stands or falls with honoring mutual agreements and discussing extra money. And, for example, the solving of the nitrogen problem has come to a standstill.”

Roduner added that the Housing Deal is a long-term project. “You will always have good and bad years. But we’ll really have a structural increase in the number of homes needed in the coming period. And now there is a delay,” he said. “I am also concerned about the housing market in the short term, just like other people. We must all really do our best to push the existing projects over the line.”