Some 12,000 homes to hit the Dutch market as Swedish group eyes exit

Heimstaden is selling 12,000 of its 13,500 rental homes in the Netherlands. The Swedish real estate investor previously blamed “hostile” government policy towards landlords for the sale. However, according to Financieele Dagblad, high debts and avoiding financial troubles are the main reasons behind the sale.

When announcing its plans to sell most of its Dutch presence, Heimstaden cited the “political climate” and a “hostile policy towards landlords” as the cause. The company called higher transfer tax and planned rent regulation the reasons for its withdrawal.

However, FD reports that Heimdstaden needs money due to increased interest rates and high debts. The selling of Dutch properties is part of a larger European plan to ditch up to 25,000 rental homes in several countries.

Heimstaden Bostad is under great financial pressure. The company financed recent years’ rapid growth mainly by debt. It currently has almost 12 billion euros in tradable bonds and loans. And, due to recently falling real estate prices and increasing interest rates, the company is now feeling the consequences.

“Of course, the current economic conditions play a major role” in the Heimstaden’s decision to sell almost all of its Dutch rentals, country manager Michiel Vrijman told FD. “If the capital markets were not as they are now, there would be much less incentive to sell. But the Netherlands is seen as a fairly risky market because of its political policy.”

Another factor in the Netherlands’ accounting for fully half of Heimstaden’s planned sales is that home prices in the Netherlands are still holding up. Rental properties may yield higher returns here than in Germany and Sweden, where house prices have fallen by almost 10 and 15 percent, respectively, since the peak.