The number of sales will also decrease next year. The cooling of the real estate market continues according to Carola de Groot and Stefan Groot, banking economists. For this year, the bank expects prices to rise by almost 14% on average, but next year it will really take off. They expect prices to fall by an average of 3%.
The number of homes changing hands will decline further next year, economists think. Mortgage rates have risen sharply in recent months.
Until recently, those who wanted to fix their interest for ten years were offered a rate of less than 2%. The interest for this customary period has now risen to almost 4%. As a result, potential buyers can borrow less money to buy a home.
As a result, they can offer less. One consequence of this is that the range from which they can choose narrows and that some buyers (temporarily) drop out.
Even higher horde
And that will mostly apply to beginners, the bank expects. Often they are completely dependent on what they can borrow because they are not bringing in any money from a home they have already been able to sell. “The hurdle to first-time homebuyers is becoming increasingly difficult to overcome,” economists said.
Home prices have risen faster than the maximum amount first-time buyers can borrow (see graph above). The average selling price is now higher than the maximum mortgage amount that double-average earners can borrow.
Still speculative sellers
For most sellers, the cooling housing market is still no reason to fear selling their home at a loss. Prices have increased by no less than 33% over the past two years. Anyone selling their home now won’t suffer losses, economists expect.
Another factor is that in recent years homebuyers have borrowed far less money relative to their home’s value than, say, a decade ago. The maximum amount that can be borrowed has been significantly reduced. Since 2018, a home buyer can borrow a maximum of 100 percent of the home’s value.
See also: RTL Z House index on the latest developments in the real estate market
Declining confidence in the housing market is caused by fears of a recession, says housing professor Peter Boelhouwer in conversation with Roland Koopman.
