Too many single family homes for too few families; Vacancy, depreciation looms: ABN Amro
Stop building single-family homes, ABN Amro advises. The Netherlands already has “too many single-family homes for too few families,” and these will eventually end up with falling values or standing vacant. To get the housing market moving and address the housing shortage, project developers should focus on building homes for seniors, the bank said in a report on Friday.
“The number of single-family homes is twice as large as the number of families for which these homes are intended, and this imbalance will increase further in the coming decades,” ABN Amro said.
About 5.2 million of the 8.2 million homes in the Netherlands are single-family homes. That is two-thirds of the Dutch housing stock, while only one-third of Dutch households consist of families. Despite this, municipalities are still fully committed to single-family homes in their construction plans. According to the bank, at least 270,000 such homes will be added to the housing stock in the coming years.
Another 900,000 single-family homes will become available by 2050 as the elderly people occupying them move out or pass away. “We are currently in a wave of aging, but in 40 years, the baby boomers will no longer be with us, and a great many of these types of single-family homes will come onto the market,” ABN Amro analyst Jorke Kooijenga told NOS.
About 70 percent of Dutch residents aged 65 to 74 currently live in a single-family home. And the number of families in the Netherlands is barely growing. This combination will eventually lead to vacancies and a decline in value, especially in regions where the population is decreasing.
Households without children or single people can obviously also live in a single-family home. But a home that is too large can be unaffordable for first-time buyers or unsuitable for seniors to maintain.
According to Kooijenga, municipalities need to take much more account of the future situation when making their building plans. “People aged 65 to 75 cannot find a new home,” he said. “Older people do not want a traditional assisted living unit. They are looking for a slightly spacious home with a nice kitchen, on one level, and a pleasant hobby room in addition to the bedroom.”
Kooijenga believes that building senior housing is the best way to quickly address the housing shortage. "Let's not try to add even more family homes, but rather more suitable housing for the elderly. This group can then move on. And that frees up homes for young families looking for a house."
