Limited impact corona on housing market

Based on the facts if you claim something about the effects of the corona crisis on the housing market, I wrote in my previous column. We now have the first facts. The month of April, the first month in which the restrictive measures were fully in force, has not gone so badly. In our region (Eindhoven, Helmond and 14 surrounding municipalities) 579 houses were sold in April. That is 31 fewer than in April 2019, a decrease of 5%. View the report here.

Still a negative effect, I hear you think. But then we forget that the housing market has been declining for about two years due to the extremely tight supply. In the entire second quarter of 2019, for example, there was a decrease of 7.6% compared to the second quarter of 2018. So this 5% decline is not really out of tune at the moment. This makes it likely that the decline has more to do with the continuing tightness than with corona.

In our brokerage offices we notice little hesitation among buyers. At most, they are in the higher price brackets (above €500,000). There the potential buyers are often entrepreneurs and at the moment of course they have something else on their minds. Beneath that limit, the appetite to buy is certainly no less. There are still bids above the asking price. And at Funda the visitor statistics – after a small dip at the beginning of the crisis – are back on level.

All this supports the statement that the limited decline in sales is more due to the tight supply than to the consequences of the corona crisis. We also see that the decline mainly occurs in places with a tight supply, such as Eindhoven, Nuenen and Deurne. But up to now, none of this is allowed to have a name, and the price increases continued in 13 of the 16 municipalities. In itself, a moderation in that respect would not be bad for the market, by the way. In any case, broadening the supply through rapid new construction on a large scale remains an option.