House prices fell further in May compared to April, reports Statistics Netherlands. But year-on-year, prices fell sharply, by 5.6%. An average house now costs almost 404,000 euros. With a total decline of 9%, we will be at the level of 2021 early next year, says Middeldorp. ‘This is a correction to a very large increase that came before that.’
Even the higher bids seem to be starting up again somehow, Makelaarsland noted in the Telegraaf. Although, according to Middeldorp, this could be a lagged effect of lower asking prices. An important factor in home prices is market expectations, Middeldorp says. After all, if you buy a new home, you usually have to sell your old home as well. “People don’t want to be mistaken about this discrepancy, and so price expectations also start to play a role.”
Less additions in the peak
In the end, you don’t build enough “into peak prices.” If prices then fall, new construction in particular will decrease, resulting in a reduction in construction. That means scarcity will continue to exist for the time being, Middeldorp fears. “It’s just dragging itself around. In a completely free market, price determines who gets which house. Now you intervene, but this only shifts the problem from one side to the other».