Home purchasers now less likely to bid over the asking price, broker says

Recently, people buying a home in the Netherlands have become less prone to bidding above the seller’s asking price, said the large online broker Makelaarsland. The situation has begun to return back to the level of 2018, which is another signal that the housing market in the Netherlands is rapidly cooling down.

About one in three bids was above the asking price, at Makelaarsland last month. By comparison, in the first half of this year more than three-fourths of all bids were still higher than the seller was seeking.

“In terms of figures, it has been a long time since such a situation has occurred,” said Makelaarsland director Gijs van Wijgerden. “The year 2018 was the last time that we had to deal with these kinds of percentages. At the time, the percentage of bids above the asking price was slightly lower at 30 percent.”

Earlier figures showed that housing prices have been falling in recent months. At the beginning of this year, the largest price increases in decades were measured. The reason for the turnaround are the rising interest rates, which means that buyers are no longer able to obtain higher mortgages.

Bank economists are puzzled over where this trend will end. In September, Rabobank experts still predicted that prices would increase in 2023. But the situation has changed quickly. At the end of last month, the same bank predicted that houses will become more than 3 percent cheaper next year on average.

Laura van Geest, the head of the Netherlands Authority for the Financial Markets (AFM), recently called falling house prices a “source of concern.” Still, she said, the situation is clearly different from the drop in prices more than ten years ago during the financial crisis. A sharp fall in house prices is not currently expected because the housing supply is lagging behind high demand.

Van Wijgerden of Makelaarsland tried to reassure people. “You can wonder whether the current hysteria in the housing market is justified. 2022 was not a bad year if you look back further than 2021. That year was extreme; this year the market is stabilizing again,” he indicated. “It seems that buyers and sellers are getting used to a new reality in the housing market and that they are leaving the craziness behind a bit.”