Economy
- 4.8
  
  Economic growth
  
  The score regarding the economic growth decreased to a 4.8 compared to 2023 Q2 and is the lowest score since two years. The Gross domestic product (GDP) decreased by 0.2 percent in Q2 2023 (GDP figures lag by a quarter) relative to Q1.
  In the first estimate, the decrease amounted to 0.3 percent. The upward adjustment is caused by new figures on manufacturing and business services. The contraction in the second quarter can mainly be attributed to a decline in the trade balance and household consumption.
  Source: Statistics Netherlands
- 9.3
  
  Unemployment
  
  The score on unemployment rate decreased slightly from a 9.5 to a 9.3. In the period December through February, unemployment declined by an average of 3 thousand per month. This resulted in 364 thousand unemployed in August 2023, i.e. 3.6 percent of the total Dutch labour force. This means that the unemployment rate is higher than six months previously.
  Source: Statistics Netherlands
- 5.0
  
  Inflation
  
  The score of the inflation increased this quarter from a 0 to a 5. This is due to the rapid decrease in inflation.
  The consumer price index (CPI) was 3 percent higher than in the same month of last year. The decrease in inflation compared to the previous quarters was mainly due to the price development of energy (electricity, gas and district heating). In August, energy was 46.7 percent cheaper than twelve months previously.
  *In the Netherlands the CPI is the main standard for measuring inflation. The main conceptual difference between the CPI and the HICP for the Netherlands is that, unlike the CPI, the HICP does not take into account the costs of homeownership. In the Dutch CPI, these costs are calculated based on developments in rental property prices.
  Source: Statistics Netherlands
Housing
- 10
  
  Market liquidity
  
  The housing market remains tight, which is indicated by low supply-demand ratios. In the second quarter of 2023 the market liquidity scored a 10. The low market liquidity shows the ongoing pressure on the Dutch housing market.
  Source: Calcasa
- 5.9
  
  Rental prices
  
  Price levels on the rental market are still high, mainly as a result of the enormous scarcity. Although, the increase is below previous quarters, affordability of housing remains under pressure for some households. This applies mainly to home seekers in the lower- and mid-market segment.
  Source: Calcasa
- 1.2
  
  Transaction prices
  
  The driver transaction prices dropped to a 1.2. Owner-occupied dwellings were on average 5.5 percent cheaper than in July 2022. House prices reached a low in June 2013; they subsequently followed an upward trend until August 2022. Then the trend reversed, but prices have risen again over the past two months.
  Furthermore, in the first half of this year, approximately 100.000 houses were sold. This represents a decrease of over 7 percent relative to the same period in 2022.
  Source: Statistics Netherlands, NVM
Consumers
- 2.1
  
  Consumer confidence
  
  Since the end of the first quarter the consumer confidence remained at the same level. This resulted in an unchanged score of 2.1 in consumer confidence.
  In August, consumer confidence stands at -40, compared to -39 in July. Consumers are more negative about the economic climate. Consumers’ willingness to buy remains unchanged. At -40, the consumer confidence indicator in August is positioned well below its long-term average over the past two decades (-10).
  Source: Statistics Netherlands
- 1.0
  
  Affordability
  
  After the all-time low in the second half of 2022, the affordability score has just slightly improved. The housing shortage is large and the affordability of housing in the Netherlands remains under pressure.
  The rise in interest rates has been a major factor in causing prices of owner-occupied houses to fall over the past six months. At the same time, the rise in interest rates has worsened the maximum loan capacity of home seekers, especially for first-time buyers. Overall, both prices of owner occupied houses and houses for the rental market are still high and the enormous scarcity continues. Affordability of housing remains high on the political agenda.
  Source: Calcasa
- 6.7
  
  Satisfaction
  
  The annual benchmark showed a small decline (0.2) to a score of 6.7 in 2023. The score of 6.7 is the actual score the tenants gave Dutch institutional investors for their services. Tenants are mainly satisfied with their housing and living environment, and a point of attention is the handling of complaints.
  Source: IVBN/Customeyes
Sustainability
- 5.5
  
  CO2 emissions
  
  The score for CO2 emissions dropped quite a bit to a 5.5 in the third quarter of 2023. Greenhouse gas (GHG) emissions were 5 percent lower than in Q2 2022. This was mainly due to 23 percent lower emissions in the electricity sector. However, emissions in the mobility sector were 7 percent higher than one year previously.
  Source: Statistics Netherlands
- 6.1
  
  Renewable electricity
  
  The increased use of renewable electricity continued, albeit at a slower pace compared to the previous quarter. The production of electricity from renewable sources rose by 14 percent in the first half of 2023 compared to previous year.
  Solar power production increased by 25 percent, while wind power production was up by 16 percent. This was largely related to increased capacity and more favourable weather conditions.
  Source: Statistics Netherlands
- 9.0
  
  GRESB
  
  The Dutch non-listed residential companies scored a total of 90 points on average in 2023. This high score reflects the fact that institutional investors are devoting considerable attention to sustainability issues.
  The Global Real Estate Sustainability Benchmark (GRESB) is a tool used to compare the sustainability scores of real estate investment funds. The benchmark rates environmental management practices and their implementation.
  Source: GRESB
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Housing Market Indicator

overall score, actual per Q3 2023
- Consumers
  3.3
- Economy
  6.3
- Sustainability
  6.9
- Housing
  5.7

Housing Market Indicator

In the third quarter of 2023, the Housing Market Indicator (HMI) showed a slight recovery, climbing from 5.2 to 5.5. This modest uptick was driven by stabilised inflation and increased solar energy production.

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5.5

Housing Market Indicator

overall score, actual per Q3 2023

About the Housing Market Indicator

The Dutch housing market is one of small proportions but with many faces. Addressing and interpreting the differences in the right way is key for investors. As an objective indicator of the current market situation we developed the Housing Market Indicator (HMI). This tool provides a quick but thorough overview of the Dutch housing market from a residential investors perspective. The HMI will be updated twice a year.

The HMI is made up of 12 key determinants. Not only economic and housing market developments are included, developments in the field of sustainability and the situation of Dutch (residential) consumers are also important factors. The rental housing market and the satisfaction of tenants in the important middle segment of the housing market are reflected in the HMI. This unique composition of factors constitutes an indicator which offers a solid reflection of the elements that are important for Vesteda as a residential investor and for other investors.

The 12 drivers of the HMI are divided into 4 different quadrants with 3 drivers per quadrant. The 12 drivers are scores on a scale from 1 to 10, based on the best available data. We believe transparency is very important, that is why we only used public-data. It should be noted, however, that with some drivers the data lags behind the market situation as no recent data is available. To arrive at a score, the data has been placed in historical perspective as far as possible. On some drivers, there is little historical data available which means only data from recent years is used. The data from most drivers was then scored on a 10-point scale where the historical lower and upper limits were determined as the maximum range. Only on the drivers GRESB and customer satisfaction are the actual scores used. The average of the scores on the 12 drivers was then used to calculate a final score. As the indicator only contains historical data, predictions are not included in the HMI.

As the manager of the largest residential fund in the Netherlands, Vesteda believes it is important to increase the knowledge on the Dutch residential investment market and to promote transparency. With the Housing Market Indicator, Vesteda therefore offers more insight into current market developments on the Dutch housing market.

Housing Market Indicator

In the third quarter of 2023, the Housing Market Indicator (HMI) showed a slight recovery, climbing from 5.2 to 5.5. This modest uptick was driven by stabilised inflation and increased solar energy production. However, challenges posed by economic factors tempered the overall progress.

The stabilisation of inflation contributed significantly to the rise, boosting the score on this driver from 0 to 5.0. Simultaneously, heightened solar energy production led to a 2.2-point increase in renewable electricity, reaching a score of 6.1 on the respective driver. Despite these positive trends, economic growth, CO2 emissions, and transaction prices posed hurdles, offsetting some gains.

On a positive note, the Global ESG Benchmark for Real Assets (GRESB) saw improvement, rising from 8.6 to 9.0. This advancement underscores the sector's commitment to sustainable practices, demonstrating progress in environmental, social, and governance initiatives.

Despite the slight rise of the HMI, the challenges in the housing market still remains a main concern. Stabilised inflation offers a foundation for growth but the uncertainty in the market remains.

Economy

Housing

Consumers

Sustainability

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