Dutch home sales prices rise for second straight quarter; Buyers overbidding again

Existing owner-occupied home prices increased slightly in the third quarter, the second slight increase in a row, the realtors’ association NVM reported. The period of home price decreases seems to be over. The tightness in the housing market also increased, and that is reflected in more people overbidding again, the realtors said on Thursday.

The average existing home sold for 422,000 euros in the third quarter of 2023, 1.7 percent more than the second quarter. Compared to the third quarter last year, the average sale price was still 1.7 percent lower.

NVM realtors sold 33,500 existing owner-occupied homes in the third quarter, 2.4 percent more than a year earlier. The number of homes put up for sale dropped by 9 percent compared to the second quarter and 18 percent compared to the third quarter last year. That means that the shortage in the owner-occupied housing market increased again.

“The current housing shortage has increased from 315,000 homes a year ago to 390,000 in 2023. That is 826,800 home seekers for whom there is no home available,” said Lana Gerssen, real estate agent and chairman of NVM’s Housing department. In the third quarter, the average buyer had 2.6 homes to choose from, compared to 2.7 in the second quarter. “We are concerned about this, because it reignites competition between buyers. We hear from our members that buyers are again overbidding the asking price.”

The Netherlands needs to build more houses. That’s the only way to solve the housing shortage, Gerssen said.

However, the housing construction sector is struggling with increased material and labor costs. And newly built homes are becoming too expensive for buyers. Earlier on Thursday, Statistics Netherlands (CBS) reported that the number of newly built homes sold dropped by more than half in the second quarter.

The new construction market showed a slight recovery in the third quarter, but sales remained historically low, the NVM said. NVM realtors sold over 5,400 newly-built homes, 14 percent more than in the second quarter. The average price was 474,000 euros.

Chris van Zantwijk, real estate agent and vice-chairman of the NVM Housing department, thinks consumers are becoming more willing to buy newly built homes. “However, sales figures are still low from a historical perspective. Supply continues to increase, and withdrawals and project postponements characterize the market. The housing shortage, therefore, continues to grow, leading to additional pressure on the existing owner-occupied housing market.”

Van Zantwijk urged the Cabinet to keep working with market parties to convert construction plans into actual, finished homes.