In addition, potential buyers are further discouraged by the fact that
subsidies cannot yet be passed on to a following buyer when they elect
to sell. This makes a re-sale disadvantageous to the seller.
Demand for'premium B' (subsidized) dwellings is virtually nonexistent.
This should come as no surprise when one considers that based on a
purchase price of 170,000 guilders, a 100 percent mortgage at 12 per
cent interest, requires a buyerto have a gross annual income of at least
70,000 guilders.
Fortunately, the situation in the housing market does not mean that
the Dutch have less interest in owning their own homes.
It would be desirable if the authorities could create the conditions for
turning this interest into an effective demand. We are thinking of
governmental measures such as the lifting of local governmental
restrictions on sales, the abolition or softening of the regulations
governing the building of new property, a continuation of unlimited tax
relief on loans which do not exceed 100 per cent of the purchase price or
market value, abolition of transfer tax, and the more rapid processing of
zoning plans as approaches to reducing the interest rate component in
the cost of newly built dwellings.
Another important factor would be getting the people of the
Netherlands to gradually realize that affordable housing is going to
require a higher proportion of their disposable income. It remains to be
seen to what extent the reduction in price of existing houses to levels
below that of comparable new houses will stabilize the market.
In the rental sector, there continues to be an erosion of the profit from
rented property due to the increasing expense of operation. One solu
tion, that of selling the property to the tenants or, if they were to vacate,
to third parties is made difficult but is not entirely prevented by the
regulations of the local authorities. This would be beneficial mainly
because from the past it has become apparent that owner-occupancy, I Yie)
even of former rental units, improves the quality of the housing stock. ban
Finally, the same treatment is being accorded to both potential tenants shoi
and potential purchasers of these dwellings, so that now the possi- loar
bility of sale is not entirely precluded.
Although the economic environment has a strong influence on demand
for office space, we can still expect reasonable leasing activity recogniz
ing the level of office leasing is stabilizing.
The office market is still centered in the big cities, Utrecht particularly
being an active area, and in the so-called growth towns such as Almere,
Houten, Nieuwegein and Zoetermeer. Within the major cities there is a
movement from the center city to the suburbs, partly due to traffic
congestion within the core area.
Interest from institutional purchasers is good, with demand centered on
prime locations. The security of long-term leases and the property
having minimal maintenance are general requisites for sale trans
actions. Demand for office space for actual use by the owner is limited,
mainly because of reluctance to invest due to the shortage of available
funds.
With office-warehouse buildings, the demand for space in the cities is
moderate, while outside locations have little demand. Rent and sale
prices are under strong pressure to reduce. However, measures to
stimulate investments such as WIR (the investment account act), ROT
(physical planning allowance) etc. still have some positive effect.
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