Hoping to escaping skyrocketing rents by buying a house in the Netherlands? You may need to think again. 😬
In the first three months of 2024, absolute madness has returned to the Dutch real estate market.
At least, that’s the conclusion drawn by Dutch real estate association NVM Makelaars, as NU.nl reports.
Soaring prices and high overbidding
Although the first quarter of the year is usually quiet on the home-buying front, real estate agent Lana Gerssen tells NU.nl that this year saw the pressure on the market increasing drastically.
Due to a lack of supply, the average price for a Dutch home currently stands at a whopping €432,000 — more than 9% higher than just a year ago.
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But it gets worse. Of all the houses sold between January and March 2024, more than half (55%) sold above asking price. On average, buyers overbid by 1.8%.
Why is this happening?
So, why is the Dutch housing market so effed up? As you would guess, part of it has to do with the massive ongoing housing shortage.
READ MORE | Why is there a housing shortage in the Netherlands? The Dutch housing crisis explained
Adding to the issue is slightly lowered mortgage interest rates and wage increases, allowing buyers to borrow more money and, therefore, make higher bids.
These combined factors are causing tightness in the market, leaving the so-called “krapte-indicator” (market tightness indicator) at 2.4. This means every home buyer can choose from 2.4 homes.
For reference: a balanced market has a tightness indicator between 5 and 10.
So, how do we fix this?
Ah, yes, the million-dollar question. To pop the Dutch housing bubble, the Netherlands would need to significantly increase the number of homes for sale.
This could be achieved by converting office spaces, dividing homes and, of course, constructing new homes.
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But all that is not quite as easy as it sounds. “Through all the conditions and requirements, we see that the development of new construction is becoming entangled in a forest of regulations,” the NVM said to NU.nl.
Therefore, it’s the government’s responsibility to consider removing barriers to meet the ever-growing housing demand.
Are you currently trying to buy a home in the Netherlands? Tell us about your experience in the comments!
Have been searching for a flat in den haag region for over 4 months and so far obtained nothing but rejections due to low bidding. Haven’t seen a worse market than this in my life. Worst part is you have no clue how much you need to bid.
On addition, even if you decide buying a property way outside your target city, still there is no availability or any price difference. Absolute madness.