Housing market prices in the Netherlands remain stable
23 april 2020
Source: NVM | Even as we find ourselves at the beginning of the sixth week of 'social distancing', it appears that the housing market is still performing well. The price of a house sold during the period 16 March – 15 April is comparable with that from the previous month. Households with concrete plans to purchase a house are continuing to pursue these plans. NVM chairman Onno Hoes strongly disagrees with doom-and-gloom predictions that claim a crisis in the housing market is looming on the horizon.
NVM, the Dutch branche organisation of real estate agents and valuers, is the only party that uses information based on real-time data and requested that its subsidiary brainbay compare housing market numbers from the beginning of the financial crisis (end of 2008) to those at the beginning of the corona crisis.
"The shortage at the beginning of the corona crisis is still here," says NVM chairman Onno Hoes. "Whereas we are now dealing with a very tight housing market, a strongly declining supply of homes for sale, and a steep rise in prices, back then we were dealing with a balanced housing market in which the supply of homes for sale had been increasing for some time, and price trends were much more moderate," according to Hoes.
Another major difference between then and now is new-build production. Whereas in the previous 5 years over 300,000 homes were produced with great difficulty, in the 5 years before the credit crisis, a housing production plan was in existence that was partially stimulated by the government. This led to almost 80,000 newly-built homes being produced per year and a housing shortage of approximately 150,000 homes. 
Lana Gersen, chairman of the Housing department at NVM, "Everything came to a standstill for months on end during the credit crisis; the situation is really different now. There is still a sufficient amount of confidence in the housing market. It is important that the construction of homes in the mid-market and for people with double the average income resumes quickly."
Every home counts
Based on the data from NVM, it appears that the corona crisis has had little negative effect on the housing market. The price of a home sold during the month between 16 March – 15 April is comparable with the price from the previous month. Households with concrete plans to purchase, and are at the point of taking this step, are still pursuing these plans.
The number of homes sold by households decreased by 7% the past week compared to the previous week, but the numbers are not completely comparable because Easter Monday is not a business day. The percentage of households that reversed the purchase of a home, meaning use of the preconditions was made, increased during the first weeks of social distancing from 2.5% to 4%. However, that percentage dropped back to 2.5% during the past week.
NVM maintains its stance that the large shortage in the housing market can only be reduced by continuing to build in the years to come. "It is important that precisely now both public and private direction should emerge between authorities, building companies and financial institutions. Construction and the conversion of offices to homes, and also the conversion of shops to homes. Every home counts," according to Hoes.