Friday, April 12, 2024
HomeEconomyNew Home Sales Plunge by Over 50% as Supply Starts to Dry...

New Home Sales Plunge by Over 50% as Supply Starts to Dry Up

According to new research just 3,300 newly-built homes were bought in the second quarter of the year, fewer than half the sales booked in the same period in 2022. The 56% decline is the biggest since sales the CBS and land registry office began monitoring the new property market separately in 2015.

By contrast, the number of existing properties to change hands in the same period fell by 6% to 44,500. Across the housing market, sales were down 13%, the ninth quarterly drop in a row. One criticism often levied at new housing developments is the price, which puts most new homes out of reach of the average buyer. In the second quarter, the average price paid for a new property was almost €496,000, down nearly €20,000 on a year ago.

However, corrected for quality and type of property, prices were actually 1.7% higher, the CBS said. The average price of an existing property fell 5.2% over the same period. The lack of sales is also having an impact on developers, who want to sell 70% of a new development before pressing ahead with the project.

Major residential construction projects are being scrapped because they don’t have enough buyers and the number of new developments is plunging. Developers organisation Neprom said earlier this the number of new homes may be down 50% on previous years. Last year, 20,000 new homes were sold to private buyers, compared with 36,000 in 2021. And based on a survey of its members, Neprom expects this year’s total to be just 15,000.

Amsterdam’s housing chief Reinier van Dantzig said last month the number of new homes built in Amsterdam this year is likely to be no more than 4,500, well short of the 7,500 target.

Dantzig, who described the figures as “terrible”, said it is becoming increasing difficult for the commercial sector to build profitably because of rising costs and interest rates. “It is a tussle to get every home built,” he said.

Nevertheless, newly built properties can be interesting to international workers who plan to stay in the Netherlands for some time because they have high energy labels and don’t require renovation of maintenance, said Henk Jansen, from Expat Mortgages. 

“You won’t have to pay some of the costs that you will be liable for if you buy an older property and the new housing will have an A-energy label, which is good for your electricity bill,” he said.  “The downside is that you will have to wait until the property has been completed to move in, and that could take a year or so.”

Source: DutchNews

Continue to the category


Most Popular