Housing prices fall again, further decline in store
The demand for owner-occupied housing fell again in 2011. At the same time, the amount of housing offered on the market rose further. As a result, prices came under increasing pressure. Last year, the average price for an owner-occupied house fell on average by 2%. This year, a decline of around 3% must be accounted for.

Fear and new standards
The fall in the demand for owner-occupied housing is determined by two aspects: the palpable fear among consumers of long-running financial obligations, partly in the light of loss of purchasing power and increasing unemployment; and – precisely to protect consumers from this – stricter standards with regard to lending.

Temporary measures versus long-term problems
To break the spell, temporary stimulatory measures are mainly being deployed to pull consumers over the line. The tide has not turned, however. The question remains as to whether such measures will be able to remove the long-term risks that consumers currently encounter.

More interest in rental housing
For decades, owner-occupier rates have only increased. Now, however, interest is increasing in rented housing for the first time in years. There is perhaps a temporary upturn, but consumers are currently opting for short-term rather than long-term financial obligations. Corporations cannot meet this increased demand, partly because they are being forced to perform their original role. This could possibly result in them being coerced to sell part of their holdings. It is clear that supply is insufficient to meet the demand for affordable rented housing.

Less new building, signals of shortage
The falling demand within the purchasing sector and the increasing supply of existing owner-occupied housing is resulting in a decline in the production of new housing. Developers, housing corporations and builders are adapting projects on a large scale, which will lead to lower production numbers and smaller developments. In the meantime, the number of households is rising annually, which is already leading to shortages in some segments. This is the case, for example, with accommodation for students and seniors.

Change now
Despite all the negativism that dominates the Dutch housing market, the current situation provides enough reason for implementing policies of renewal and reform. It can only be positive that the range of choice for house seekers has improved. This situation is forcing housing providers (developers and investors) to act more than ever in a customer-friendly manner.