Overheated housing market threatens to saturate

Property, house, for sale
Photo credit: Jens Neumann/Pixabay

The number of mortgage applications in Eindhoven for buying a house decreased in the second quarter of this year. It is 22% less compared to the same period last year.

Due to the corona crisis, there was a spike in mortgage applications around this time a year earlier.  But the number of applications is now also lower than in the second quarter of 2019. This is according to figures from De Hypotheker. This indicates that the housing market is becoming increasingly saturated.

Indeed, only 51% of the number of mortgage applications are now used to buy a home. It was 71% in 2019.  The average mortgage amount is getting higher and higher. From €272,000 in 2019 to €326,000 in 2021. This is an increase of about 20 %.

“The need for an affordable own house is as great as ever. Due to the corona crisis, there has been considerable savings and a lot of money is available. But the number of transactions has decreased. This is partly explained by the enormous but temporary peak during the corona crisis in 2020. The explosive decline in the number of mortgage applications for the purchase of a home, as compared to 2019, indicates a saturated market,” says Wilma der Sterre of De Hypotheker in Eindhoven.

‘Money’s worth’
“Due to the overheated housing market, many homeowners are utilizing their money’s worth and looking for alternatives. Instead of buying a new home, one in five homeowners is choosing to renovate their home or make it more sustainable. First-time buyers in particular are postponing their buying plans because there is too little affordable housing on offer. Everything indicates that the housing market is increasingly at a point of saturation,” says Der Sterre.

Source: www.studio040.nl

Translation: Chaitali Sengupta. She also gives online INBURGERING classes.

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