Dutch home prices reach new record with 12.3% year-on-year increase in third quarter
Home prices in the Netherlands increased by 12.3 percent in the third quarter compared to a year earlier. The average Dutch home cost 473,000 euros, breaking the record set by the second quarter of 2024, the realtors association NVM reported on Thursday.
The price increase was slightly lower than in the second quarter when home prices shot up 13.6 percent on an annual basis. The NVM spoke of a “stabilization” and a “good development.” But 12.3 percent is still a significant increase.
On a quarterly basis, home prices increased by 0.4 percent from the second to third quarter of 2024. The realtors called the “minimal” quarterly increase a correction for the 7.7 percent increase from the first to the second quarter but added that the summer is also a quiet time in the housing market.
Overbidding was still the norm in the third quarter with two-thirds of homes selling above the asking price. On average, buyers paid 4.6 percent or 22,000 euros above the asking price last quarter. “The demand for homes is still high and buyers are prepared to pay more to obtain their desired home,” the realtors said.
NVM realtors sold just under 37,000 homes in the third quarter - the highest number in almost four years. “That is remarkable considering it is a summer quarter.” The number of housing transactions increased by 10.9 percent compared to a year earlier and by 0.6 percent compared to the second quarter. In the past five years, housing transactions decreased by an average of 4.5 percent in the third quarter compared to the second quarter.
Homes were on the market for an average of 28 days before the purchase agreement was signed. That is four days faster than a year ago and one day longer than the second quarter. 90 percent of all homes on the market sold within one quarter.
The new construction sector continues to revive. In the third quarter, 6,300 newly built homes were sold, a decrease compared to the 7,800 in the second quarter, but a 27 percent increase compared to a year ago. “The upward trend continues,” the NVM said. In the first nine months of this year, 21,500 newly built homes were sold, more than in the whole of 2022 and 2023. The number of sales is increasing mainly in medium-sized and small municipalities, but things are improving throughout the country.
After a long period of stable prices, the price per square meter of newly built homes increased to 4,600 euros. “This is due to the increase in smaller homes,” NVM said. “The average sales price remains stable at around 475,000 euros. But as a buyer, you get fewer square meters for the amount spent.”
The NVM expects the price increase to continue given that demand is much higher than supply due to the housing shortage. The number of homes listed with NVM realtors at the end of the third quarter was 10 percent lower than a year ago. “This reduced supply may contribute to the continuing tightness on the market and the pressure on prices.”
The NVM is also worried that the supply doesn’t meet home seekers’ requirements. Government measures focus on building small and affordable housing, targeting first-time buyers. “This seems logical, but it is a form of symptom control and actually makes the underlying problem worse,” the NVM said. “First-time buyers can’t find a home because people who already have a home cannot move to the next one. If the focus on new construction shifts more to movers, the housing market can remain dynamic. A varied supply is essential for this.”
