The Netherlands’ housing market will take a dip in the next two years, Rabobank expects. The coronavirus crisis will cause unemployment to rise, resulting in the demand for houses declining, and prices falling at least a little, the bank said on Tuesday, NOS reports.
Rabobank expects house prices in 2021 to be an average of 0.8 percent lower than this year. And in 2022, house prices will fall another 2.6 percent. After that, home prices will start to increase again, the bank said.
The housing market dip will come later than the bank expected in its previous quarterly report, when Rabobank expected housing prices to start falling in the fourth quarter of this year. This may be due to the government’s coronavirus support package, which has kept employment reasonably stable so far, at least among potential homebuyers aged 25 and older. And as a result, the housing market conintued to run at full steam.
But people will eventually lose their jobs, or at least worry about losing their jobs, Rabobank said. Investors will also be more cautious. And this will result in home sales falling from 220 thousand homes sold this year, to 190 thousand next year.
The bank also pointed out that a relatively large number of starters, younger people just starting out on the housing market, are buying a house this year. This may be because both investors and people selling a home to buy a new home are more reluctant due to the economic downturn, giving starters more opportunity. The same thing happened at the beginning of the 2008 credit crisis, the bank said.