Amsterdam house price boom will end, say ING economists

old houses in AmsterdamThe huge price rises in the Amsterdam property market may come to an end in the coming years, according to ING economists.

House prices in Amsterdam rose by some 22% in 2016, boosting the average cost of a city home by some €50,000 over the year.

Living in the capital is becoming so expensive that first-time buyers in particular are unable to get a foothold on the market, the economists say in a new report.

‘This will reduce demand in the capital and price rises will be more modest as a result,’ the ING report said. ‘When house prices rise so sharply, the risk of a price correction increases.’

In addition, house prices may eventually fall because the current low interest rates are unsustainable, the ING report said. A sharp interest rise or economic crisis could be a trigger for a downturn in prices.

While there is no crisis at the moment, ‘people who buy a house in Amsterdam this year should not assume that prices will rise by upwards of 10%,’ said economist Senne Janssen in the Parool.