Holiday home prices increased by 8% last year despite financial uncertainties

The market for holiday homes in the Netherlands showed a “remarkable recovery” last year, after a weak 2023. The prices for holiday homes rose by almost 8 percent to an average of 246,000 euros, a report from real estate agency NVM stated.

Last year, over 4,150 vacation homes changed owners, around 12 percent more than a year earlier. The NVM thinks it is surprising that the prices are continuing to rise, despite inhibiting factors such as the high transfer tax, uncertainty about the tax addition and the proposed VAT increase from 9 to 21 percent on recreational rental.

“It turns out that the market for recreational homes is less sensitive to the relatively unfavorable fiscal climate and seems to be going along with the trends on the regular housing market,” the report stated.

However, the growing supply of holiday homes could also be a precursor to less profitable times. “The holiday home seems to be the government's cash cow, but it is unclear what measures are in store,” said Anneke Haak-Bronsema, a board member at NVM Wonen.

The rent incomes from holiday homes are tax free. However, it is questionable whether this will remain the case, as landlords may be taxed on their actual returns. The discussion about this is still ongoing in The Hague.

Around 1,675 holiday homes were up for sale at NVM estate agents at the beginning of this year, an increase of almost 300 homes. According to board member Haak-Bronsema it is important that the holiday home market continues its recovery due to the significant contribution it has to the economy and employment.

The NVM pointed out that the costs for holiday homes are getting higher and higher, especially for homes that are at a park. The costs include service costs, leasehold, or maintenance costs. “This will put more pressure on the profits for private investors.”

According to the NVM, prices increased by more than 10 percent in half of the popular tourist regions in the Netherlands last year. The most significant price increase was in Zeeland which saw a price hike of 20 percent. One in three of the holiday homes that changed owner in Zeeland did so for more than half a million euros. Nationally, this figure goes for one in ten homes sold.