You read it more and more. The madness on the housing market is over. A tipping point on the housing market is coming. People are now also saying: I'll quickly sell, go and rent, and when the market collapses later I'll buy a new home again. Newspapers run headlines like ‘ House prices fall for the first time in three years’.
Contents
- Peak reached?
- Fall in house prices
- Buy now or not?
- Prices still rising
- Consumer confidence
- Buying strategy
Peak reached?
Over the past few months I've often been asked: ‘What do you think, has the market peaked? Is a tipping point coming now?’ If I look at the number of viewings and offers, I'd have to answer with a wholehearted YES. However, given the price rise and the final transaction prices, I say NO. On top of that, there's an awful lot of ‘cash’ money in the market. According to the latest research by Funda, the drop in site visitors looking for a home is biggest in Amsterdam. The number of site visitors in Utrecht is falling too. But does that mean prices in Utrecht are no longer rising?
Fall in house prices
Research shows that the average house price has fallen. But then why don't they look at an average price per square metre? Then at least we're not comparing apples with oranges. As it is, an average home value depends on more expensive or cheaper homes. If more apartments than detached houses are sold in a quarter, research shows that prices are falling. The month after, when it's the other way round, the price will have risen again. I find that a strange way of measuring. How can you measure the tipping point on the housing market if you don't compare the right data?
Buy now or not?
In Utrecht it's still the case that when you deliberately price a home low, there's a run on it, resulting in overbidding. Even so, you also notice that people are becoming more critical. There's so much in the news at the moment about falling prices and the tipping point on the housing market that I notice people are becoming more cautious. People walk around the home, they're enthusiastic, but they still hesitate. It's a nice house, but a lot of money. What will the market do? Because of the uncertainty, by no means everyone dares to bid properly any more. Even though they really are looking for a new home. So is the hysteria really over? Or will the battle simply start all over again once everyone notices that it really isn't easing off? Because there are still approx. 31,000 house hunters on the housing market in Utrecht, with 1,350 homes for sale. I still don't see any balance between supply and demand there.
Prices still rising
In Q2 of 2019, the average price per square metre in the Netherlands still rose by 6.2% compared with Q2 in 2018. In Utrecht, the price per square metre in Q2 2019 rose by 7.2% compared with Q2 2018. Prices are rising less quickly, but they are still rising. Yet when you look at the number of house hunters relative to the available supply, I can't imagine the market collapsing. I do expect the market to stabilise somewhat. I expect prices to rise less quickly. But a tipping point? I don't expect one.
Consumer confidence
At the moment, consumers have somewhat lost confidence in finding a nice home in a normal way. Often they don't even make an offer any more, because they expect to be outbid anyway and think it's pointless. As a result, we're increasingly getting only a limited number of offers, and sometimes none at all. Even though people would actually love to have the house. Often even above the asking price, but they think they don't stand a chance anyway.
Buying strategy
Curious what a house is worth, curious what the best strategy is, or would you like to brainstorm with me about developments in the market? Great! Gladly! Nothing is more interesting than the way potential home buyers think. If you come to view a home, do make an offer and don't be put off by possible bidders who may put in a higher offer! The tipping point on the housing market has not yet been reached.
