The supply of owner-occupied homes declined in the last quarter of 2021, while house prices rose sharply again. The NVM figures announced today do not really show that the housing market is cooling down. Yet many buyers gave up their search.
House prices rose by 20.7 percent year-on-year, about the same as in previous quarters. NVM brokers control the vast majority of the market and together sold 35,000 houses in the last months of the year, almost 23 percent less than last year – slightly more than the previous quarter.
The average sales price was 438,000 euros and that does not only concern large houses from a higher segment. A terraced house was sold for an average of 386,000 euros. And apartments also became considerably more expensive: plus 60,000 euros in a year’s time.
While 170,000 houses with an NVM flag were sold in previous years, last year there were only 141,000. This is mainly because the supply has evaporated, according to the real estate association. And in the last quarter it evaporated even further. Historically there are few houses for sale, which can also be seen from the number of advertisements on Funda.nl.
Young people more active in the housing market
We know from figures from the Land Registry that young people have become more active in the owner-occupied housing market in the past year. Experts estimate that they will settle for less house for their money. So they generally live smaller. A couple with a good income could previously bid for a semi-detached house, now they are going for a terraced house or a house in a less popular location.
The fact that people under 35, often referred to as a starter, are now buying half of the houses again, is probably also because investors have to pay more tax (8 percent instead of 2 percent, since 2021) and may drop out because house prices are getting too high. to make good money. Investors invested significantly less in the housing market last year. Capital Value calculates 7.7 billion euros, which is a decrease of 32.5 percent in the transaction volume in 2020.
Fewer viewings indicate that part of home seekers are dropping out
It is also striking that the number of viewings has fallen sharply in the last quarter. The NVM does not show this in its quarterly report, but Makelaarsland already knows how to report this as one of the largest members. According to Gijs van Wijgerden, director of Makelaarsland, there has been a trend break for the first time. Throughout the year, the number of viewings per home hovered around ten, with peaks reaching almost twelve. Now there are just over six. The first signs of a turnaround came in November, after which we can now gradually say that buyer interest is cooling.”
Home seekers are tired of making mistakes all the time and take a break. They are waiting to see how the housing market develops, so they let you know
Other indicators point to the same thing. The search traffic to Funda has been declining sharply for several months. Surveys commissioned by Vereniging Eigen Huis show that almost three quarters of the Dutch consider it an unfavorable time to strike the housing market. And a poll by Viisi Hypotheken shows that only 20 percent of all first-time buyers on the Dutch housing market expect to buy their first home in the next twelve months, compared to a quarter in the previous quarter.
According to Van Wijgerden, the figures are supported by comments from their customers. “Home seekers are getting tired of constantly making mistakes and are taking a break, they let our real estate agents know. They think the prices are too high and are waiting to see how the housing market develops.”
50,000 euros between first and second bid
But there is also another part of the house hunters that pulls out all the stops, says Van Wijgerden. “Our purchase brokers sometimes warn that they should not offer too much, but then customers throw in another 10,000 euros just to be sure because they just really want the house. It regularly happens that there is as much as 50,000 euros between the first and the second bid. Or even that there is only one offer, way above the asking price. There is talk of inciting behaviour, a feeling among buyers that they must outbid. Low interest rates have a psychological effect on this. An additional 10,000 euros hardly makes a difference in the monthly costs.”
The quarterly figures of the Dutch Association of Real Estate Agents show that 80 percent of the houses have been outbid. It took an average of 23 days for a home to be sold. 95 percent of the homes had a sales time of no more than three months.
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House price through the roof again, despite fewer potential buyers entering the market | living
Source link House price through the roof again, despite fewer potential buyers entering the market | living