Article contributed by Stekkies https://www.stekkies.com/en/
How Corona’s affecting rental prices
The fact that Corona is not just a health crisis, but maybe even more so a financial crisis is widely known. Right? Right. We also know that financial crises usually drop market prices in nearly every industry, right? Right. So does this mean renting a place in Amsterdam finally has become cheap(er)? Depends. We wrote this blog about it ; Are prices really going down or is it just an illusion?
Since Stekkies is on its way to indexing every real estate office in Amsterdam, we have a lot of data on housing prices every week. Aside from helping customers find their perfect rental quickly, this enables us to have a great overview of how the current market is developing, and whether Corona has any real impact on the market. Knowing that you’re reading this wanting to know how the corona situation affects YOUR rental price, we’d figure giving some boring statistics from a few years back won’t really answer your question. Instead, we’ve created a short term comparison between the house prices around July – September 2020 and October – Januari 20/21. Not to sound too clickbait-y; but we think our findings might surprise you.
We saw an initial drop
One of the major impacts this crisis had is that people travelled less, and especially plans for moving abroad got cancelled often. The direct result is that a lot less expats came to Amsterdam, and the expats already here fled the city back to their home country in fear of not being able to return at all. This meant their houses became vacant, and there were less and less people in search of a move. I’m not an economist, but I did google that an increase in supply and a decrease in demand drives a price down.
So it did. Our friends at Pararius (oke maybe not friends; more like vague acquaintances) showed that Q3 of 2020 for the first time ever introduced a decrease in rental prices in Amsterdam; 5,9% to be precise. Especially the more expensive areas (Centrum, de Pijp) showed the largest decrease, some up to 8,4%, since those areas are mostly populated with expats and prices were already highly ‘overrated’. Great. So is Amsterdam’s rental market finally coming to its senses?
Introducing a housing ‘sale’
Not quite. Even though it hasn’t happened often before, Amsterdam has only introduced a housing ‘sale’. Landlords are offering a monthly discount for a set time period, before the rent returns to its normal price. Great to seize a temporary opportunity, but it doesn’t yet signal a structural change in the market prices. We saw these discounts especially in Q3 of 2020, but Q4 already showed some signs of rental prices bouncing back to their regular prices. Looking at our own data of Q4, we see signs of a pattern in what kind of houses were most affected by these price changes. Let’s be very clear though: our data might not be completely comprehensive of the entire markt. This is merely an indication.
What does it mean for you?
Smaller apartments have quickly bounced back to from their drop in Q3. Clear facts about why this is the case are hard to deduct from our data. Since these smaller apartments have a lower price point to start with, tenants could possibly be willing to pay a minimum just to get an apartment in Amsterdam. For mid sized apartments (40 – 90 m2) a downward trend continues. For you as a potential tenant, we would recommend paying close attention to the cost per square metre you’re paying for your new rental. This might mean that currently, you could be getting a lot more value for your money if you’re paying slightly more for a larger apartment!
If we’re taking a closer look at how prices changed per neighbourhood, differences become even more apparent. The prices of the more expensive neighbourhoods that dropped the most in Q3 (Centrum, de Pijp, Oost) have stabilized, while other neighbourhoods only now start to see a drop in prices. The neighbourhoods on the left side of this chart are definitely the ones to watch currently, as there’s a big chance you’ll get a good deal in any of them. In case of the neighbourhoods that are now seeing a rise in their prices compared to Q3 this could mean 2 things; either they were less affected by COVID and a steady increase in price continued, or their price in Q3 dropped too much, and tenants quickly became willing to pay more than what the price had become.
Search by neighbourhood
We’ve seen it matters in what area you search. Traditionally it’s pretty hard to constantly search for houses AND be picky about what neighbourhood you want to live in. With Stekkies, we’re solving this problem by offering extensive filters on each neighbourhood in Amsterdam. Try it for free, and see how easy it is to search in specific areas. Good luck searching!
