The prices of existing owner-occupied homes were on average 5.6 percent lower last month compared to the same period a year earlier. The fall in house prices follows a price development that started earlier; in April it was a decrease of 4.4 percent compared to a year earlier. This is evident from figures from the Land Registry and the Central Bureau of Statistics (CBS) on Thursday.
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The fact that house prices are almost 6 percent lower than in May last year does not necessarily mean that buyers also have to pay less. Indeed, key interest rates have increased from last year – central banks raised them to cope with inflation. The increases then affect mortgage rates, so buyers can borrow less or face higher potential monthly payments.
Rising interest rates also affect house prices. In the Netherlands, they increased from June 2013 to August 2022, but since then an almost unremitting decline has started. The average house price was 403,913 euros last month. In May, almost 16,000 housing transactions were registered – more than 4 percent less compared to the previous year. The number of sales also decreases over a longer period.