News update: House prices in the Netherlands continue to fall

The cost of buying a house in the Netherlands is continuing to fall, with an annual drop of nearly 6% recorded in May, according to figures from the statistics office CBS and the Kadaster land registry.

There are wide regional variations, but the average amount paid for a home is now almost €404,000, compared with €446,000 in August last year when prices hit their peak, and that is good news for people looking to buy a home.

House prices have fallen almost 10% since then as interest rates rose. The shortage of properties on the market has been an additional problem, and fewer homes are also changing hands.

Fewer homes sold

In May, just over 15,000 homes were sold, down 4% on a year ago, according to the Kadaster figures, which are based on finalised deals. In the first five months of this year, the number of houses and flats which found a new owner is down 10% in 2022.

First-time buyers, however, may be benefiting. Last month the Kadaster said 58% of homes in the big Dutch cities are now being sold to first-time buyers, compared to 50% a year ago.

Nevertheless, there are early indications that restrictions on buy-to-let mortgages have not yet had an impact on younger buyers and may also be making it harder for tenants to find a place to live.

Buy to let

Several cities, including Amsterdam, Rotterdam, The Hague, Utrecht and Eindhoven, have implemented a law that came into force in 2022, allowing them to stop investors from buying homes to let out in specified neighbourhoods.

Research by the University of Amsterdam and Rotterdam’s Erasmus University suggests that the ban so far has mainly benefited older, better-off tenants who were already able to afford a house rather than the youngsters the scheme was supposed to help.