Holland's housing market "is in a coma", one Dutch newspaper
has declared, as Dutch real estate enters a serious slump.
The comments follow a period of nose-diving, where house
prices and economic recession have fed on each other as the Netherlands joins
the other victims of the global financial crisis. But while Italy and Greece
have hogged the EU headlines, Holland may end up outdoing them all.
The country's housing inventory is described by The
Telegraph as "nearing South European levels", a telling sign that Spain's
slouching property market has set the benchmark for "bad", but the Netherlands'
deficit eclipse everyone else's, with household debts reaching 249 per cent of
income - the highest in the eurozone. Even Ireland's is only 202 per cent.
Construction is also at an all-time low, with building
permits dropping 9 per cent over the last 12 months, the lowest since 1953.
As a result, house prices are dropping too. Values have
fallen 15 per cent since the market's peak in 2008 - and are predicted, one
agent tells the newspaper, to drop by another 5 per cent this year.
These kinds of conditions are normally ripe for overseas
investors, with foreigners keen to inject life back into a comatose market, but
even though Holland rose by eight places in TheMoveChannel.com's Top of the
Props last month, the country's unsold houses have actually doubled in number
Is it the economic outlook that deters investors? Officials
are rushing to assemble an austerity package this week as Fitch reveals that it
may downgrade the country to a "negative outlook" during their next review.
Is it the lack of buy-to-let potential? America has seen
growth in rental revenue rise to $6.2 billion in 2011, according to the International
Powered Access Federation, compared to Europe's combined total of €2.3
Is it a lack of confidence? Even the threat of the current transfer
tax holiday being suspended in July has only led to uncertainty among buyers
and lenders, with banks wanting "more clarity from the government on its
long-term plans for the housing market", according to Radio
While other international markets have received equally bad
press, areas such as the Costa Blanca in Spain, the Algarve in Portugal and
Florida in the US have all proven ultimately resistant to negative buzz. Established
as tourist destinations, perhaps it is that overseas investors already know
that visitor interest will remain high, providing strong returns on low house prices.
Or perhaps it is that there is much more information available for traditional
Either way, with markets such as Miami appearing to have bottomed
out, recording four monthly price increases in a row and a record number of
sales in March, the comatose Holland certainly has a lot of waking up to do.