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Corona crisis has little effect on housing market so far

April 20, 2020
Sold sign outside a house.
Photo: DutchNews.nl
Photo: DutchNews.nl

The coronavirus outbreak has done little to dampen demand in the housing market in its first month, according to the land registry Kadaster.

Initial queries by potential buyers have recovered since falling sharply when the lockdown restrictions were announced on March 12, the agency said. The biggest fall-off in interest came in the first areas to be hit by the virus, such as Noord-Brabant.

‘The number of inquiries is starting to rise back up, but it’s not yet at the level prior to March 12,’ Paul de Vries, the Kadaster’s housing market expert, told NOS.

The number of requests from estate agents triggered by sales contracts is slightly down, suggesting that fewer people are going through with house purchases, said De Vries. ‘It’s too early to say anything for sure, but it’s notable that the number of inquiries by agents has fallen four weeks in a row.’

Banks have reported a surge in mortgage applications, with twice as many in March compared to the previous year. Hypotheken Data Netwerk (HDN), which collates information on mortgages, said many homeowners were remortgaging in anticipation of a rise in interest rates later in the year.

Economists at ABN Amro said last week that they expected the number of house sales to fall in 2020 as a result of the corona crisis, but prices will not start to drop until next year. Interest from private investors is expected to weaken as they focus on the stock markets in the wake of last month’s share price crashes.

House values have been rising since the end of the last crash in 2014 and the average price broke through the €300,000 barrier last year.

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