Another price-increasing measure

Minister Ollongron has been Minister of Housing and Urban Development for over four years now, but she has not achieved much with it. With the end of the reign in sight, there was a sudden push to speed up the construction, but by then it was already too late. Just as it was too late, under pressure from the House of Representatives, to decide to partially abolish the landlord levy that prevents the housing corporations from building. Government policy over the past four or five years has consisted mainly of taking measures that may have been intended to give some stimulus to housing construction, but which in practice helped to push prices up further. Like the abolition of the transfer tax for first-time buyers, which I wrote about last time.

In her final days (let’s at least hope that there will be a new cabinet) Minister Ollongren has made a move, or at least announced that she wants to make a move. She wants a more transparent sales process including a bidding log where sellers and prospective buyers can check the bidding process. There have been complaints about favoritism and deliberate price pushing by real estate agents who play off buyers against each other. The Dutch Home Owners Association had 600 complaints earlier this year. That’s a lot, but I doubt very much if all those complaints were justified. And besides: out of more than 200,000 sales transactions in one year, it is perhaps not a very large number.

I fear that here too the cure is worse than the disease. Together with the national estate agents association NVM and other organizations, work is already being done on an improvement plan with, for example, joint disciplinary proceedings. We also welcome a bid log on behalf of the seller. A disciplinary judge can – if a complaint is filed against an estate agent – request such a log and check the bidding process. But if you start publishing the bare figures from such a log anonymously, you actually create false transparency. There is a risk that buyers will use the bid log for one property to substantiate a bid for another property, even though that property may be comparable, but is of much lower quality. Each transaction is unique. There is a great danger that a public log will lead to unnecessary overbidding.

In a tight market, potential buyers will always be left disappointed. But then make sure that the tightness becomes less and stop playing symbol politics.