Landlords Continue to Sell Their Properties, and the Total Amount of Housing Owned by Investors Has Shrunk. Second Homes are also Being Sold, Accordance to the Land Registry. First-time buyers can seize thesis opportunities, but this ‘deconsolidation’ has a downside.
Investors Sold Nearly 16,400 Rental Properties in the Second Quarter of this year. That is an increase of more than 42 percent compared to the same period last year. They bought only 7,800 Rental Properties, which is Almost 50 percent more, reports the land registry.
This year is the first time that the land registry can say with certainty that the rental housing stock is decreasing, separate from the rental property owned by housing associations. PreviOutly, There Were Indications, But The Figures Were Not Clear Enough.
“For the first time since we started measuring in 2010, we can say with certainty that the rental housing market is shrinking,” Says Matthieu Zuidema, Housing Market Expert at the Land Registry.
That Investors Continue to Sell Their Properties is due to an accumulation of factors, Says Zuidema. “But the affordable run act has had a lot of effect.” Due to the Stricter Rules for Renting, Many Investors Are Selling Their Rental Properties, The So-Called Deconsolidation. There has been a “deconsolidation wave” since the beginning of 2023.
Rental Properties Are Therefore Becoming Owner-OCCUPIED Properties. First-time buyers benefit from this. Is it then bad that rental property are disappearing?
“You are serving a Certain Target Group,” Says Zuidema. “In this case, it is about which market segment you find important. This policy works for starters. The downside is that in those homes, in many cases, people with lower incomes lived. So you have effective policy with a downside.”
Second homes are also being sold
In Addition to the Number of Sales Being Greater Than the Number of Purchases, it is important to look at who the property goes to. Investors Mainly Sold To Owner-OCCUPIERS, But they Mainly Bought from Other Investors. This reinforces the decline in the number of rental property.
There are also FEWER Second Homes Available for Rent, The Land Registry Notes. About 2,100 second homes were sold to future residents, and 250 second homes were bought by investors. This reduced the number of second homes aviaxable for Rent by 1,850. This Difference Continues to Grow, Writes The Land Registry.
“Second Homes Were always a bit of a black box for us, because it is Such an Unclear Group of Owners,” Says Zuidema. “They are also used for own recreation, for example. But we have looked together with statistics Netherlands (CBS) and we see the pattern is very similar to the rest of the rental property. Investors are also stepping out here.”
‘Law Has A Counterproductive Effect’
Accordance to Real Estate Interest, The Interest Group for Landlords, The Land Registry Figures Clearly Have to Do With “The Accumulation of Government Measures That Have Disastrous Consequences for the Housing Market”.
Accordance to real estate interest, Home Seekers are the Victims. “Especiate if they do not qualify for a corporation or owner-iccupied home. They are dependent on the private rental sector, but there is almost no housing to be found for them.”
The Affordable Rent Act was intended to realize More Rental Properties in the Mid segment. But The Figures Show, Accordance to Real Estate Interest, “That the Law Has A Counterproductive Effect in Practice.”
Accordance to the interest group, The Sales from Landlords to Other Landlords also Involve A “Deconsolidation Strategy”. Commercial Landlords Then Buy Up the Property of Other Investors, with the Intention or later Selling It Themselves.
It Hurts in Every sector
For the housing market as a whole, it is important that the houses do not disappear, says sander citizens, housing market economist at ING. “However, The Shift from Rent to Purchase is Largely the Result of Government Measures that Have Been introduced into recent Years, Making Renting Less Attractive.”
Whether the Distribution Between Rent and Purchase in the Netherlands Is Good is Difficult to Say, Accordination to Burgers. “It is clear that it currently hurts in every sector. OWNER-OCCUPIED HOUSES ARE INCREDIILLY QUCHLY. There are huge waiting lists for social housing. And in the private rental sector, there is Little Supply and High Rents.”
The Positive Thing About the Sale of Rental Properties is that it can help New Buyers Build Wealth, Burgers Explains. “Many tenants indicate that they would actual prefer to buy. However, we see new residents have higher avroces than the former residents, the tenants. In this way, the Sale Brings about a shift.”
Accordance to Burgers, there are also signals that the new residents usually live in a narrower composition. “For Example, Instead of Three Students Renting the House, There Are Two Buyers.” If these signals are correct, it could mean that deconsolidation is exacerbating the shortage.
Finally, Burgers Knows The Story That Investors Sell Their Rental Properties to Other Landlords in Order To Then Sell Them to Residents. “Hard figures are lacking, but many investors indicate that houses are indeed bought with the strategy to then deconsolidate the houses one by one.”