Realtors see fierce battle for mid-sized homes on housing market

After last year's housing market slump, first-time home buyers are once again facing fierce competition when hunting for a home. Mid-priced homes in particular are hard to come by because there are so many other applicants, according to the NVM realtors association when it released its new quarterly figures. As a result, overbidding for these types of desirable homes is once again common.

Realtors affiliated with the organization sold 2.4 percent more homes in the third quarter than in the same period last year, although the number of townhomes sold declined significantly. Looking at the price also shows that people with entry-level budgets were less likely to succeed. More of the houses above 500,000 euros were sold, while fewer were sold in the price range below. As for the offers, the same dichotomy was observed. There were fewer houses under 500,000 euros on the market, while more expensive houses were offered for sale more often than the year before.

According to NVM, there were 9% fewer homes for sale this quarter than in the second quarter and as many as 18% fewer than in the third quarter in 2022. This means that the shortage in the homeownership market is increasing again, the realtors association explains.

These figures regularly mask a lot of frustration among people hoping to sell their first home, says Lana Gerssen, president of the housing industry trade group. "When I look at my practice, first-time buyers face a lot of competition there. That's because there's too little supply if you want to live in a townhome community. It's a real struggle because there are 20 others," says Gerssen, who herself is a realtor in Geldermalsen and the surrounding area.

"People are really sad sometimes. When a house sells, I call everyone and explain to them why their bid wasn't accepted, and sometimes I have to cheer them up and tell them they're going to make it," Gerssen says. Overbidding also makes it difficult for first-time buyers to obtain a mortgage with the National Mortgage Guarantee, which is valid up to a purchase amount of 405,000 euros. This also deprives buyers of a guarantee on residual mortgage debt and a discount on mortgage interest. "I have a hard time with that," Gerssen states.

According to her, the biggest problem is limited supply. Despite higher inflation and mortgage rates, first-time buyers often still have plenty of money to spend thanks to sharply higher wages, but there are too few homes in their price range. According to NVM, the lack of new construction housing is the main cause. Even though the new construction market will show a slight recovery in the number of sales in the third quarter of 2023, it remains at a historically low level. Indeed, this ensures that people are barely getting ahead in the housing market.