Home prices increase annually for the first time in 11 months; Up 1.6% in December

Last month, owner-occupied homes became more expensive compared to a year earlier for the first time in almost a year. According to Statistics Netherlands (CBS) and the Land Registry, prices increased by 1.6 percent compared to December 2022, the first annual increase since January last year. In November, homes were still just under 1 percent cheaper than a year earlier. Over the entire 2023, the prices of existing owner-occupied homes dropped by 2.8 percent compared to a year earlier.

The average price of an existing owner-occupied home was over 422,000 euros in December, making homes 0.2 percent more expensive than a month earlier. The new increase is due to scarcity in the housing market and the fact that home buyers have more to spend again because their salaries have risen. That undid the problems caused by higher mortgage interest rates. Higher borrowing costs led to a months-long price decline, ending the rise that started in 2013.

According to Land Registry figures, the scarcity in the housing market was also reflected in the number of homes that changed ownership. There were just under 20,000 transactions in December, 8 percent less than a year earlier. For the whole of 2023, the decline was 5.5 percent.

Last week, the realtors’ association NVM reported that owner-occupied home prices rose for the first time in over a year last quarter, climbing 5.3 percent compared to the end of 2022. The real estate agents often identify trends in the housing market earlier because they look at the moment the purchase contract is signed. CBS records sales only later, at the time of registration by the notary.

Looked at the entire year, the prices for an existing owner-occupied home were 2.8 percent lower than in 2022 on average, CBS said. Utrecht province saw the biggest price decrease at -4.8 percent, followed by Noord-Holland with -4.7 percent. The decrease was lowest in Limburg at -0.8 percent.

There were 5.5 percent fewer home sales in 2023 than in 2022. Limburg had the biggest decrease in transactions at -13.3 percent, followed by Flevoland at -11.4 percent.