Amsterdam housing market needs more room to move

Amsterdam’s housing market is changing rapidly. Supply is increasing, yet affordability, mobility and new-build development remain under pressure. For Hello Zuidas’ Housing Special, we speak to Hans Peter Fris, owner of FRIS Vastgoedexperts, Gordon Vos, Manager New Build, and Kasper Goris, Office Director. Drawing on their respective areas of expertise, they share their views on the housing market, political choices and the development of Zuidas as a residential district.

More supply, but the market remains under pressure

At first glance, Amsterdam’s owner-occupied housing market is showing positive developments. The number of available homes increased by 23 percent last quarter compared with a year earlier, while the number of transactions rose by 5 percent. At the end of the second quarter, 4,640 homes were for sale. Apartments in particular contributed to the increase in supply.

“For home seekers, this means more choice,” says Kasper Goris. “At the same time, the number of sales is also increasing. So both supply and demand are growing.” The average amount paid above the asking price, at 5.9 percent, is also lower than it was a year ago.

The picture is less positive in the rental market. Hans Peter Fris: “That market is becoming increasingly gridlocked due to far-reaching regulation, such as the Affordable Rent Act and higher taxation in Box 3. Stricter rules and lower returns are causing investors to withdraw, which means rental homes are disappearing from the market.” The sale of former rental properties is making the rental market even tighter and further restricting mobility.

Politics also determines what gets built

Both national and local politics have a major influence on the housing market. Amsterdam’s ground lease policy and its 40/40/20 policy partly determine where homes are built and for whom, while the Housing Valuation System affects rental prices.

According to Hans Peter, one of the main bottlenecks is the accumulation of regulations. “In some areas, Amsterdam imposes additional requirements on top of national legislation and regulations. As a result, some projects are no longer financially viable and ultimately do not get off the ground.” Lengthy municipal decision-making processes can also delay the delivery of new homes.

Zuidas is becoming a true urban district

Once primarily known as a business district, Zuidas has now moved well beyond the pioneering stage as a residential area. Kasper: “Zuidas is now in the crucial transition towards becoming a complete and vibrant urban district.”

The ambition to reach around 10,000 homes by 2030 plays an important role in that development. “The focus is increasingly shifting from standalone residential towers to complete, cohesive neighbourhoods,” Kasper says. More family homes, greenery and low-traffic areas should help create a more attractive living environment. That change is already visible: Zuidas is now much livelier outside office hours as well.

Building to improve mobility

Sustainability is also transforming the housing market. Energy labels are becoming increasingly important in mortgage lending as well as in buyers’ decision-making. At the same time, Gordon Vos sees a mismatch in the new-build market.

“Many smaller homes for first-time buyers are being developed, but these buyers often find it difficult to plan around a construction period of two and a half to three years. It may therefore make more sense to develop more larger homes for people moving up the housing ladder. They often have greater financial flexibility, while the homes they leave behind then become available to first-time buyers.”

“A balanced housing mix
is essential for
sustainable growth”

Looking five to ten years ahead, the three ideally see Amsterdam and Zuidas offering a more diverse housing stock for first-time buyers, families, those moving up the housing ladder and empty nesters. Hans Peter: “A balanced housing mix is essential for sustainable growth. Social diversity ultimately creates greater cohesion and a livelier, warmer and more pleasant living environment.”