Our latest blog article overviews trends observed in the Dutch housing market data for Q1. As housing prices fall slightly and interest rates remain high, mortgage applications have decreased. Meanwhile, there is more good news for first-time homebuyers, who are increasingly active in the current market.

CBS ( Centraal Bureau voor de Statistiek ) reports that in February 2023, the prices of homes occupied by owners were lower than the previous year, marking the first decline since April 2014. Following record-breaking prices and widespread overbidding in 2022, the housing market has finally experienced a decrease this year. This trend is expected to persist, with further price reductions anticipated in the upcoming years.

Interest rates have been climbing up since 2022. According to DNB ( De Nederlandsche Bank), the average interest rate on new mortgages provided by banks has more than doubled since February 2022 (then 1.67%, now over 3%). It is expected the interest rates to remain the same.

DNB ( De Nederlandsche Bank) predicts that first-time buyers will benefit from declining house prices since autumn 2022 and notable wage increases in recent months. As their incomes continue to rise, first-time buyers will enjoy increased financial flexibility and strengthened borrowing capacity, allowing them to allocate more funds towards purchasing a home.

According to economists, these factors will result in a more than 4% improvement in the affordability of owner-occupied homes by the end of 2023 compared to the final months of 2021, before the rise in interest rates.

In 2023, the maximum amount for an NHG-backed mortgage rose to € 405,000. As house prices continue to decline, more and more homes fall within the price limit and qualify for NHG. Our research shows a 39% year-on-year increase in new guarantees issued for home purchases in the first quarter of 2023. Homebuyers can expect an increasing supply of affordable homes with an NHG guarantee.