Residential market still immune to corona

The corona crisis hits us hard in many areas, but the housing market still seems immune. Some forecasters now see the ‘first cracks’ appearing in the market picture. We still don’t see those cracks in the daily practice of our brokerage office. Sales continue to be sustained and prices continue to rise. The Land Registry registered 22,571 home transactions in July, an increase of 7% compared to July 2019. Over the entire first six months, the increase was also 7%, to a total of 129,073 sales. Statistics Netherlands calculated that prices also rose by more than 7% in the past four months.

Interestingly, a third corona survey (in July) among members of the Dutch Home Owners’ Association showed that homeowners are considerably more positive than in previous months. Only 18% expect the market to grind to a halt and only 22% of respondents are worried about a possible drop in house prices. The huge housing shortage in our country and the persistently low mortgage interest rates apparently form a strong basis for demand and price developments in the housing market.

This housing shortage will only increase in the coming years. There are too few locations, the land is expensive and construction prices continue to rise. Municipalities are focusing on the preservation of green space and are placing many demands on project developers. In addition, some municipalities are busy with rearguard battles, such as the introduction of a self-housing obligation for new-build homes. By doing so, they want to make it impossible for small investors to buy a house and then rent it out. This in turn means ‘regulating instead of stimulating’ without much effect. After all, renting out such an owner-occupied home can also contribute to the growth in the number of mid-rental homes desired by many municipalities. The implementation and enforcement of such a regulation is at the expense of the attention that is needed to solve the real problem, the shortage of new construction and the slow implementation. I would like to say to all the municipalities: put the rapid realization of feasible new construction plans without too many bells and whistles at the top of all priority lists in order to solve the major housing shortage. Then we don’t need a Catharina church in Eindhoven that reaches to heaven.