- Confidence in housing market slightly weaker
- Supply shortage dampens transaction growth in popular regions
- Tight housing market continues to drive prices higher
Although confidence remains high, sentiment has faded somewhat in the past year. Since the peak late last year, optimism has weakened slightly – despite the sustained economic recovery. Enthusiasm is being tempered partly by the expectation that interest rates have bottomed out and are poised to rise, but above all by the growing housing shortage. The tightness in the housing market is reflected in the transaction pattern. Sales are rising sharply in the regions that previously lagged behind, but are under strong pressure in the regions where the stock of properties for sale is limited. Buyers are struggling to find a suitable home. We expect this trend to continue, with the transaction volume falling next year after four years of strong growth. New-build activity is failing to keep pace with demand, and will continue to do so in the coming years. The growing shortage is driving prices higher. So much so, that an increasing number of would-be buyers are finding it difficult to meet the mortgage criteria. Firsttime buyers are already on the sidelines. They have to save first before they can enter
the market. Investors are accounting for a growing share of the number of transactions, indicating that personal savings and assets are playing an increasingly prominent role in the housing market. Apart from a minor adjustment to price developments this year in connection with the higher number of completions, we maintain our previous forecasts. We prefer to keep our powder dry until the new Dutch government is in place and has unveiled its plans. We are particularly curious to hear how it proposes to tackle the housing shortage.