Eight out of ten Dutch home-owners expect to lock in gains when selling their homes

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Eight out of ten Dutch home-owners expect to gain if they were to sell their homes today, with only one in ten believing they wouldn’t. The remainder were don’t knows. Owners of medium-priced homes are the most sanguine about the amount they think is involved. Well over 20% of owners of homes with purchase prices between EUR 200,000 and EUR 400,000 assume they stand to make between EUR 50,000 and EUR 100,000, with another 20% predicting gains in excess of EUR 100,000. These and other findings may be gleaned from a survey of 1,250 home-owners commissioned by ABN AMRO and carried out by market research agency Ipsos.

Expected gains on home sales tend to provide a good idea of home equity. Eighty per cent of Dutch home-owners report a net equity in their homes of EUR 128,000 on average. In part, they can tap into this without selling their homes, but are so far proving quite reticent to do so, the survey reveals. A mere seven per cent of respondents have ever done anything with their home equity, or are planning to. Almost half know little or nothing about the possibilities of using their home equity

Rising house prices

Philip Bokeloh, ABN AMRO economist, comments: “In by far the largest number of cases, home-owners say the value of their homes has gone up on the back of higher property prices, while extra repayments on the mortgage and renovations were also cited as reasons for increased equity values. Four in ten home-owners reckon they can sell their current homes at a gain of at least EUR 50,000 euro. In the country’s three biggest cities and suburbs, people are predicting major gains, with one-quarter of home-owners putting the figure at between EUR 100,000 and EUR 200,000. Due to a dearth of available housing, it is their homes that have gone up in value most, whereas the squeeze on the residential property markets is much less in the country’s northern and eastern provinces. Owners are expecting the lowest relative gains in these regions.”

Supplementing old-age pensions

Owners aged 50 years and older, in particular, have seen the value of their homes surge, with some 22 per cent now thinking they’re worth between EUR 100,000 and EUR 200,000 more. Among the retired, 14 per cent are even thinking the gain might work out at between EUR 200,000 and EUR 300,000. Eight per cent of those on state old-age pension (AOW by its Dutch acronym) and who tap into their home equity without selling their property are using this to supplement their AOW and any other retirement pay.

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