Housing prices to rise more slowly; Only one in three can afford average home by 2027

Dutch house prices are expected to continue rising in the coming years, but at a slower pace than before, according to De Nederlandsche Bank (DNB) in its latest economic forecasts. At the same time, affordability is decreasing: by 2027, only about one in three households is expected to earn enough for a mortgage on an average home, down from nearly half in 2019.

The DNB projects that house prices will increase by about 4 percent in both 2026 and 2027, down from the more than 8 percent annual rises seen in recent years. The slower growth is attributed to more moderate wage increases and a slight rise in mortgage rates, which together slow the growth of how much people can borrow for a home.

House prices are still rising, largely because of limited supply, which, according to DNB, is reducing affordability. By 2027, an average home is expected to cost about 575,000 euros, making it unaffordable for many households. More buyers are relying on additional funds, such as personal savings or family support, alongside their mortgage.

Experts at ING reported on Friday that the number of home sales seems to be rising. The bank forecasts a 3.5 percent increase in house prices next year and about 245,000 transactions, a 2 percent increase from this year, which would exceed the previous record from 2017. ING attributes this growth to a gradual increase in the housing supply, despite it still being limited.

ING also highlights the surge in sales of former rental properties. Due to recent legislative changes, it has become less attractive to re-rent homes after leases end, so many are now sold.

About one in five transactions this year involved such properties, often older, lower-quality apartments, which has helped to temper the overall increase in house prices.