2023-07-06 07:58:20
Those who want to buy a house and waited a while in the hope that prices would fall further, will be disappointed for the time being. Although a house now costs an average of almost 9 percent less than a year ago, when prices peaked, it is once more 2.8 percent more than in the first quarter of 2023. The average price is now 410,000 euros, compared to 395,000 then.
The housing market is rebounding, according to NVM, the real estate agency association, from its own quarterly figures. The number of viewers is increasing, more homes are being sold and prospective buyers are once once more bidding above the asking price. The shortage remains, says NVM board member Lana Gerssen. “Demand and supply are not in balance. Far from it even.”
Prospective buyers have confidence once more, the NVM sees, they are over the shock of the sharply increased interest rates – and they are now stable. House prices have adapted to this new situation and are no longer going through the roof. Wages have risen, many buyers are therefore able to afford current prices. And all those buyers compete with each other once more. “More demand with the same supply”, notes the NVM, “leads to prices cautiously going up once more.”
‘Sign of recovery’ of the new building
That supply must also come from new construction, and the NVM sees ‘a sign of recovery’ in that area. And that is necessary, because the new-build market is struggling with many setbacks. High interest rates have made investing in housing expensive and the increased construction costs made it difficult to build affordable houses, even though there is a lot of demand for them. As a result, project developers are in danger of being left with their too expensive offer, and they sometimes cancel new projects.
Seen in this light, it is not surprising that new construction, unlike existing homes, is now falling in price – albeit by only 1.2 percent. The price difference between new-build (currently an average of 469,000 euros) and existing homes remains large, and that price drop is partly caused by smaller new-build homes coming onto the market. The price per square meter therefore remains high.
Nevertheless, the NVM sees ‘for the first time in a long time’ that more new construction is being sold. This is partly due to falling prices. Homes under 250,000 euros are sold less, simply because developers and builders are unable to build for such prices and make a profit on them. The growth in the number of sales is mainly in homes from 250,000 to 400,000 euros.
Apartments in the cities sell well
This growth is most noticeable in the cities, and apartments in particular appear to be selling well there. Remarkable, because developers and also real estate agents warned more than once that the new construction plans on which Minister De Jonge (public housing) has made agreements with the provinces place too much emphasis on apartments within the cities, while there is a demand for single-family homes with space around them. “Apartments are offered a lot and therefore sold a lot,” Gerssen responds. “That doesn’t necessarily say anything regarding buyer preference.”
The growing demand is good news for De Jonge anyway, with his aim for 900,000 new homes by 2030. Because as long as there is no demand, developers will not build anything – they usually only start a new construction project when 70 percent of it has already been sold. But now new construction turns out to be saleable following all.
Nevertheless, the NVM warns: the number of new construction sales is still only half as large as in mid-2021. And the number of building permits has been falling for some time, so not much can be expected from future new construction. In recent times, the NVM has also seen that many purchase agreements were still dissolved, for example because buyers did not get their finances together, but also because project developers, on second thought, saw no profit in construction.
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