The total number of mortgage applications in the fourth quarter fell by almost half compared to the same period a year ago. Applications also fell sharply in the third quarter as mortgage interest rates rose sharply. Higher interest rates resulted in the mortgage refinancing market virtually drying up in the last quarter of 2022, De Hypotheker reports. Statistics Netherlands also reported that fewer homes were sold in the third quarter, with newly built homes in particular losing popularity.
According to De Hypotheker, a chain of mortgage advisers, the total number of mortgage applications fell by 45 percent last quarter. Lenders received nearly 90 percent fewer requests to transfer a mortgage. Due to the sharp rise in mortgage interest, which has risen more than 3 percent since the beginning of last year, refinancing a mortgage is, in many cases, no longer an attractive option, De Hypotheker president Michel van den Akker said.
At the same time, the median price of an owner-occupied home fell nearly 4 percent in the fourth quarter. According to De Hypotheker, this is the first time in years that both the housing and mortgage markets have cooled.
Due to these developments, young homebuyers as young as 35 are increasingly gaining a foot in the door of the housing market. In this age category, there was a 9 percent increase in applications to buy a new home in December compared to the previous year.
The median mortgage size for a home purchase fell 11 percent. In the fourth quarter, that amount was €298,000, falling below €300,000 for the first time in two years.
In addition, for the first time in three years, the number of applications for home improvement mortgages decreased. That number decreased by 26 percent in the last quarter of 2022 compared to the previous year. Home improvement’s share of the total number of mortgage applications remained large at more than a quarter. De Hypotheker expects many homeowners to continue to invest in making their homes more sustainable next year, given higher energy costs.
Through 2022, the total number of mortgage applications fell 6 percent compared to the previous year. Last year there was a 5 percent increase in mortgage applications to buy a home among young buyers. At the same time, mortgage applications for home purchases among people age 55 and older fell by almost a quarter.
fewer houses sold
The number of new-build homes sold from July to September was a third lower than a year earlier, the biggest decline since measurement began in 2015, Statistics Netherlands (CBS) reported based on its own figures and those from the Register of the Property and the European Statistical Agency Eurostat. The number of existing homes sold also fell.
More than 5,000 newly built owner-occupied homes were sold in the third quarter of last year. A year earlier, there were still about 8,000 left. At the same time, the price of a new home increased an average of 13.7 percent in one year to almost 474,000 euros. That’s down from Q2 2022 when the median price topped half a million for the first time.
The number of existing homes sold in the third quarter fell 6.4 percent to more than 50,000. From April to June, that decline was still 10.2 percent. The price of an existing home increased by an average of 11.9 percent compared to the previous year. The price increases were leveling off, CBS said. In the second quarter of last year, prices still rose 18.4 percent annually.
There are 11 countries in the European Union where owner-occupied housing prices increased faster than in the Netherlands. The most significant increases occurred in Estonia (+24.2%), Hungary (21%) and Lithuania (19.3%). House prices only decreased in Denmark.