New home sales fell dramatically in the last quarter of 2022 amid rising prices that have pushed some buyers away from the housing market.
Sales of newly constructed apartments and family homes in the northern provinces were down about 50% from a year ago, according to a report from the CBS Statistics Bureau.
Real estate sales have plummeted across the whole country. “There are small regional differences, but the situation in Drenthe, Groningen and Friesland is consistent with the general trend,” Arjan Lamberink of Lamberink Nieuwbouwmakelaars, which has branches in all the three provinces, was quoted by the Dagblad van het Noorden as saying.
Some 5,300 new homes were sold in the last quarter of 2022, down from about 10,700 a year earlier. Meanwhile, the median price for a new home rose to €468,000, up 6.1% from a year ago. The price also increased from the median values in previous years.
More than 25,000 new homes were sold in 2022. That number is nowhere near the 90,000 houses that minister for housing and spatial planning Hugo de Jonge promised to build annually until 2030. “I’m not surprised at all,” says Sjirk de Jong, spokesperson for the NVM brokers in Groningen. De Jonge’s objectives within the ‘housing agreements’ with the provinces were way too ambitious, he believes. “We have to build 28,500 homes in Groningen over the next nine years. Considering the slow pace of current construction, we’re never going to make it,” he predicts.
New home sales took a hit last year, beaten down by rising mortgage rates that now hover around 4.5%. “Gone is the time when borrowing money cost nothing. Now it costs a little, but the difference between nothing and a little makes prospective buyers cautious,” says Wim Stuursma, spokesman for the NVM brokers in Drenthe.
Both inventories and new home prices remain high, so a drop in mortgage rates and prices might trigger a rush to buy, but until that happens, older homes will be a more attractive purchasing option to buyers. On average, a new home costs €75,000 more than an existing one, De Jong says. “The price difference between old and new buildings is too big. The sale of existing homes hasn’t slowed down. The prices even fell slightly, but that’s not the case with newly built homes.”
This is all happening at a time when there remains a strong demographic demand for new for-sale homes, real estate experts say. Many households would prefer to have more space and may be in a housing situation that is not their ideal. But the higher interest rates mean higher monthly payments for would-be buyers, who may be forced to sit on the sidelines until they drop.
