House prices expected to climb 7 percent in 2025 and 3 percent in 2026

Small increase in transaction numbers expected

With house prices climbing further, first-time buyers and home movers are both becoming more active. As a result, transaction numbers will continue to grow for the present, though at a lower rate than they did in the last calendar quarter. ABN AMRO predicts that the increases for both 2025 (+2.5 percent) and 2026 (+1 percent) will fall short of last year’s. In the long term, the housing market is likely to cool down, as price levels continue to rise marginally and with no further price drops expected. This development will be amplified when the rise in incomes also starts to level out. Another factor here is that new development is picking up pace again, and eventually the supply of houses will increase once more. Given these developments, ABN AMRO expects the situation on the housing market to return to normal in time.

Plenty of homes available, but not the right ones

Although ABN AMRO sees encouraging signs on the supply side of the housing market, this will not ease the shortage any time soon. “The government wants to make arrangements with market operators about building new homes,” explains ABN AMRO Housing Market economist Mike Langen. “Funds have been earmarked to encourage municipal authorities to complete development projects sooner, for example. This is a positive move that could give investors and property developers more confidence.” Even so, the bank argues that further measures are still needed.

In a separate publication – released at the same time as the Housing Market Monitor – ABN AMRO notes that the shortage of homes is not caused by population growth, but by demographic changes. “Plenty of homes are available in the Netherlands,” Langen stresses, “it’s just that they’re not the right ones. For example, single-person households are becoming more common, and yet we continue to build large houses. Paradoxically, the annual increase in the supply of homes is outpacing the population growth, and yet we still lack the right kinds of homes. The government needs to step in and break this logjam. Development projects should stop following the supply patterns of the past two decades and instead add a larger proportion of smaller homes. The baby boom generation generally own large houses, and selling them would create further opportunities. However, they stay on in those large homes for longer, because the current tax rules discourage them from cashing out the equity to buy a new home. The Cabinet needs to remove these obstacles. If the government then also made it easier to split up those houses into smaller units, this could give the supply of available homes a major boost.”