Amsterdam is officially dealing with a bubble on the housing market, according to Swiss bank UBS. Amsterdam is tied with Hong Kong for the third most likely city to be experiencing a housing market bubble. Only Munich and Toronto were deemed at greater risk, UBS said in the report released on Monday.
UBS defines a bubble as "a substantial and sustained mispricing of an asset, the existence of which cannot be proven unless it bursts."
Last year more Dutch were dissatisfied with the homes they live in than the years before, Statistics Netherlands said on Friday. Especially tenants were less happy with their homes, but homeowners were also more dissatisfied. Though the vast majority of Dutch are happy with the home they live in.
With the housing shortage and ever increasing land prices in the Netherlands, Dutch municipalities and developers are increasingly building skyward. The Netherlands currently counts 26 residential towers of more than 100 meters high. That number will more than double to 55, if all construction work currently on the books goes according to plan, AD reports based on its own research.
At 3:00 p.m. on Tuesday the Rutte III government will present its budget for next year. But as every year, a number of the government's plans already leaked to the press. Here follows a summary of what we know so far, compiled by NOS and RTL Nieuws.
Any money left over in the government's budget should first be spent on raising the salaries of people in the public sector, addressing the housing shortage and getting more police officers on the street, according to a poll conducted by Ipsos on behalf of NOS for Budget Day 2019. Only once all that is done, should budget surpluses be used to pay off State debt, the respondents said.
The official valuations of Dutch homes, called the WOZ value in the Netherlands, increased for the fourth consecutive year. On January 1st, the average home in the Netherlands was worth 248 thousand euros, 7.8 percent more than in 2018. That is both the highest price ever and the biggest increase in years, Statistics Netherlands reported on Friday.
Coalition party D66 wants to reduce the number of livestock in the Netherlands by half. This will reduce nitrogen emissions, and create more room to build new houses, D66 parliamentarian Tjeerd de Groot said to RTL Nieuws.
It's a simple calculation, according to De Groot. "70 percent of Dutch nitrogen emissions come from agriculture, a large part of which comes from intensive livestock farming. That is huge. At the same time, the contribution of intensive livestock farming to our own economy is not even 1 percent. The ratio is completely missing."
The Dutch government will announce multiple measures aimed at tackling the housing shortage on Budget Day. A fund of 1 billion euros in subsidies will be created for municipalities starting new building projects, and housing corporations who build new homes will receive up to a billion euros in tax discounts. First-time homeowners may also be exempt from transfer tax, the Volkskrant reports based on sources.
Dutch young people between the ages of 18 and 35 years are struggling more and more to become independent, according to a report by social and economic council SER, the main advisory body to the Dutch government and parliament. Millennials are reaching milestones like buying a house, starting a family and building up a pension later in life than previous generations, the SER said, Niewsuur reports.
Buying a house is nearly impossible in large parts of the Netherlands for single-income Dutch households who earn an average income of 36 thousand euros, according to an analysis by mortgage adviser De Hypotheker. In the province of Utrecht, average single-income households can only afford 1 percent of the homes that are for sale, RTL Z reports.
The coalition parties in the Rutte III government reached broad agreements on the focus of the Netherlands' tax plans for next year. Low- and middle-income households must see an improvement in their purchasing power. And it must become easier for people starting out on the housing market to find a home, NOS reports.
"We have taken further steps on our way to Prinsjesdag", Prime Minister and VVD leader Mark Rutte said after an hours long meeting between the coalition parties and the Ministry of Finance, which ended at around midnight on Thursday.
In the second quarter of this year, 12.8 thousand permits were issued to build new homes - the lowest number in three years and 14 percent less than in the second quarter of 2018, Statistics Netherlands reported on Thursday. The permitted building sum for the new construction and renovations of homes was also nearly 15 percent less than the second quarter of last year.
The price difference in buying a home in the Netherlands' cheapest and most expensive provinces is now 175 thousand euros, according to economists at Rabobank. The average price of a home in Noord-Holland is 388 thousand euros, while the average price in Groningen is 213 thousand euros, NU.nl reports.
The average national rent increase in the second quarter of 2019 was the lowest since the second quarter of 2015. Rents in the Netherlands increased an average of 3.1 percent in the second quarter of this year, according to figures from Pararius. This clearly shows that the price increases are slowing down, the housing platform said, NU.nl reports.
Rent increases fell below 5 percent for the first time in 3.5 years in the last quarter of 2018. And that slowing down effect is continuing, according to Pararius.
Imbalances on the Dutch housing market pose the "biggest stability risk" to the Netherlands, Dutch central bank DNB said in its latest Financial Stability Overview. The central bank also warned that a "disorderly Brexit" and the trade war between the United States and China can seriously damage economic growth.
The prices of houses in the Netherlands are still rising, albeit less rapidly than before, and the housing shortage continues. This makes it increasingly difficult for the average Dutch person to be able to afford a house.
The wealth inequality between Dutch households decreased since 2015. That has to do with the improving housing market, Statistics Netherlands reported on Tuesday based on data from 2011 to 2017. Income inequality remained at basically the same level in that period.
Municipalities bordering the large Dutch cities are seeing large population growth, which means that rents in these municipalities are also rising sharply. In the first quarter of this year, free sector rents nationwide increased an average of 4.9 percent compared to a year ago, while some areas around the Randstad saw increases of more than 18 percent, rental broker Pararius said on Wednesday, NU.nl reports.
Expats and foreign students are a big driving force behind the spike in Amsterdam housing prices, ING's economic office said in a report. Housing prices in Amsterdam increased by an average of 70 percent since the low point on the housing market in 2013, compared to the national average of 30 percent.
The municipality of Amsterdam is working on implementing a rental ban on new owner-occupied homes, in an attempt to prevent new homes from being bought up by investors and then rented out for hefty sums, the municipality said in a press statement. The ban will not only apply to the first buyer, but also to the people who later buy the home.
After years of skyrocketing prices, the housing market in the Netherlands may be cooling down. In the last quarter of 2018, one in five municipalities saw home prices decrease compared to the previous quarter, according to the quarterly report of valuation company Calcasa. The price decreases mainly happened in Limburg and Groningen, RTL Nieuws reports.
Up until 2022 another 10,500 homes and rooms will be built for students and young people in Amsterdam and surrounding region - 9 thousand in Amsterdam and 1,500 in the surrounding municipalities, the city of Amsterdam announced.
The average selling price for a home in the Netherlands surpassed the 300 thousand euros mark for the first time in history. In January homes exchanged owners for an average of 302,157 euros, Statistics Netherlands and the Land Registry reported on Tuesday.
Compared to January last year, the price for an owner occupied home increased by 8.7 percent. The housing price increase is picking up. In December homes were 8.4 percent more expensive than the same month the year before.
The wealth of the median Dutch household increased significantly in 2017, rising by 6 thousand euros to 28,300 euros. This is mainly due to substantial price increases on the housing market, Statistics Netherlands reports. If homeownership is taken out of account, the median wealth increased only slightly compared to 2016 to 14,100 euros.
Statistics Netherlands looked at all the assets and debts of Dutch households. Savings and investment mortgages are not included in these figures as the stats office was not given access to that data. Pensions are also not included.
Housing corporations are unable to build as many homes as they want due to rising construction costs and a lack of locations, they said in a survey by housing corporations' association Aedes. New construction projects also regularly turn out to be financially unfeasible due to higher construction costs, they said, NOS reports.
