89 percent of Dutch housing associations continue new-build projects despite COVID-19 crisis
7 april 2020
Recent research from Capital Value (early April) among large Dutch housing associations shows that 89% of the housing associations will not delay any new-build projects despite the Coronavirus crisis. In addition, 65% indicate that they now see opportunities for new acquisitions in new or existing homes in the Netherlands. That is good news, definitely when seen in the light of the credit crisis in 2008, when construction output of housing associations fell sharply. For the Dutch housing market, it is of great importance to add new homes to the stock to face the growing shortages. EIB (Economic Building Institute) also emphasized that it is especially important at this time that all market parties take responsibility by continuing to contract builders to keep housing construction going
Housing associations a stable partner, also in uncertain times
Many housing associations indicate that plans have already started and now continue as planned. For many years already, housing associations in the Netherlands have been investing for the long-term. 64% of the surveyed housing associations expect that other market parties may have to postpone their plans due to the Corona crisis. 65% of all housing associations right now see opportunities to take on their role and to distinguish themselves from market parties as a stable cooperation partner in projects. This provides builders and developers with the opportunity to adjust their plans and to take housing associations' wishes to expand into account.
Research from Capital Value earlier this year already showed that over three quarters of Dutch housing associations wishes to expand the social (regulated) housing stock. In addition, over half of the housing associations wishes to invest more in senior and light healthcare homes and 27% is interested to add more homes in the mid-priced rental segment.
Delay in issuing building permits needs attention
Almost half of the housing associations indicate that procedures for granting permits require extra attention. Many housing associations expect a delay in these procedures. Local authorities must do everything in their power to continue working on spatial planning procedures during this period of working remotely. Earlier research from Capital Value already showed that appeals procedures at the Council of State are also delayed. It is very important that these procedures will start again as soon as possible.
Marijn Snijders, managing director Capital Value: "Research from EIB shows that the number of issued building permits for new homes will most likely decrease to 48,000 in 2020 (in 2019, this was 57,000). This is far lower than the number that is needed to reduce the shortages. To keep new-build construction at the level that is needed, every effort will have to be made to continue the procedures for granting permits. It is good to see that housing associations take the responsibility to continue to invest in affordable rental housing. This also provides opportunities to market parties to work together with housing associations."
Also read: 73% of Dutch private investors expect limited impact corona crisis on residential investment market