Housing Market Monitor – Housing market recovery continues

by: Philip Bokeloh

Housing-Market-Monitor-October-2014.pdf ()

Home buying is back! The situation in the Dutch housing market is clearly on the mend. Interest among prospective buyers is growing now that homeowners have more certainty about the government’s housing market policy and can benefit from sharply lower mortgage rates. Meanwhile, substantial rent increases are making the rental segment less attractive, while temporary incentives such as the expanded gift tax exemption are giving an extra impulse to the demand for owner-occupied housing. The revived interest is reflected in the higher number of transactions, and prices are also on the up.

According to ABN AMRO, a further recovery of the housing market is likely next year. But only if the wider economic recovery takes hold and the government’s housing market policy includes no unpleasant surprises. As regards the first condition, we think that economic growth will be slightly higher in 2015 compared to this year. The second condition is surrounded by greater uncertainty. The housing market measures announced on Budget Day will not hamper the recovery, but the outcomes of the tax reform negotiations and their impact on the housing market are still uncertain.