The housing and construction sector has seen a small victory in 2020 as 15,000 permits for housing have been granted. 

This is a hopeful turn of events for both future home seekers, and construction workers. More housing permits have been granted in the second quarter of 2020 than in the second quarter of 2019.

This follows a push by the senate and House of Representatives in December 2019 to increase the number of housing projects. The parliament approved the Nitrogen Emergency Act, which has led to a steady increase in the number of housing permits.

Mixed opinion

CBS Chief Economist, Peter Hein Van Mulligen, believes this is positive news for the housing economy. Speaking with RTL Nieuws, he has said “It is a welcome break from a downward trend. We are dealing with an enormous tightness in the housing market. The tightness is so great that even the corona crisis is not causing a drop in demand or in house prices.”

However, whilst corona has not caused interest to wane, it has not necessarily aided the housing economy either.

Less houses have been constructed

The lockdown period has had a devastating effect on housing construction, meaning that only 68,000 houses are expected to be built in 2020. This is lower than in 2019, during which 71,000 new houses were built in spite of less permits.

Low consumer confidence

ING economist Maurice van Sante has reported that in addition to fewer new constructions, people are less likely to buy in the current economic climate. ‘The corona crisis is causing rising unemployment and a deteriorated financial position for many consumers. Consumer confidence has been much lower since April and the willingness to buy has also fallen sharply.’


This lack of consumer confidence means that people will therefore be less likely to invest in new homes, and will instead opt for existing builds.

New construction will help

However, Van sante points out that if people are more inclined to invest in existing homes over new builds, this increase in construction will certainly help. An increase in the construction of new builds will help to counteract a housing shortage that will arise from a rush to buy existing buildings.

This means that while less people are interested in new builds now, the construction of new homes is more important now than ever.

The corona crisis has affected many aspects of life in the Netherlands but perhaps for now, we can take these new numbers as indicative of a move towards healing and growth.

Will you be investing in the housing market anytime soon? Let us know what you think in the comments below. 

Feature Image: Life-of-Pix/Pixabay


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