Twice the median income no longer enough to afford an average home in Netherlands

Buying an average owner-occupied home in the Netherlands now requires more than twice the average income, according to calculations by data company Calcassa.

The price of an average home was 452,000 euros at the end of 2023. Under the new lending standards implemented this year, a household needs an annual income of 95,000 euros to get a mortgage for that amount. That is more than twice the average income of 44,000 euros per year.

People looking for an apartment will need an income of 80,000 euros. That quickly makes homeownership for single-income households unaffordable.

“We know that prices have risen sharply in the past ten years, but if you put that in concrete terms regarding income, you will be shocked,” Calcasa director Tijs Pellemans told AD. “These are gigantic incomes. It is almost impossible for a single-income household to get by.” Buying a home now basically requires contributing your own money.

Homes in the Netherlands are expected to get even more expensive this year, with ING predicting a price increase of between 5 and 8 percent. But rising wages and lower interest rates should give people more room to lend.

That, combined with government measures to reduce competition from investors, is helping first-time buyers, in particular, De Hypotheekshop reported last week. In February, there were 30 percent more mortgage applications from first-time buyers. It was also the highest number of applications from this group in four years.