An accumulation of problems is hindering the construction of new homes, writes ABN Amro in a Wednesday report. The bank sees the numbers of homes sold and permits issued falling because of material prices, interest, regulations and electricity. The problems put “more pressure” on the government’s goal of building up to 900,000 new homes.
In the past four quarters, permits were issued for 64,145 new homes, 11.2 percent less than in the previous four quarters. Material prices remain high due to the war in Ukraine, although ABN Amro also sees the price increases leveling off. Steel, which became considerably more expensive at the start of the war, is now even slightly cheaper again than in August. Recent interest rate hikes by the European Central Bank make new construction projects less profitable and reduce demand.
The requirements that construction must meet are now becoming stricter, ABN Amro notes. Sustainability has become more important, and since a ruling by the Council of State, construction must also calculate its own nitrogen emissions. Added to this is the tightness of the electricity grid, which means that it is no longer self-evident that new homes can receive electricity.
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