Mortgage applications in the Netherlands return to last year's levels

The number of mortgage applications in the third quarter returned to the level seen a year ago, De Hypotheker reported. The total number of applications for the past quarter was 1 percent higher compared to the same period last year. This follows a sharp 31 percent decline in the second quarter. According to the mortgage organization, this indicates a continued recovery in the housing market.

There was a notable increase in applications for home purchases. Starters, or first-time homebuyers, saw a considerable improvement from the last quarter. Among homebuyers under 35 years of age, there was a 26 percent increase in applications. Older age categories experienced a modest rise.

As the housing market begins to recover, there is also a slight increase in house prices. Homes are increasingly being sold above their asking prices and are getting sold faster. De Hypotheker pointed out this trend is reflected in the average mortgage amount, which now stands at 316,000 euros, marking a 2 percent increase compared to last year. This is the first annual increase in the average mortgage amount in one and a half years. While mortgage interest rates are showing a slight uptick, increased incomes mean people can afford to borrow more.

In the third quarter, 70 percent of all mortgage applications were intended for home purchases, up from 62 percent last year. Despite a tight housing market and the slight rise in mortgage interest rates, more people, especially young homebuyers under 35, are active in the housing market. Their share has risen by six percentage points to 54 percent in a year, accounting for over half of the mortgage applications for home purchases.

However, while applications for home purchases are increasing, other types of mortgages are seeing declines. For instance, applications for home improvements have decreased by 16 percent year-on-year. The higher mortgage interest rates make it more expensive for homeowners to renovate or make their homes more sustainable. Furthermore, due to rising interest rates, the market for refinancing remains tiny in the third quarter, accounting for just 5 percent of the total.