Outlook and management agenda


The outlook for 2017 is positive. Economic growth is expected to come in at 2.1%, thanks to the ongoing rise in consumer spending, investments in houses, business investments, public sector spending and exports. However, despite falling unemployment figures, the rise in household purchasing power is expected to be more modest this year (0.7%) compared with 2016. This is largely due to the fact that the one-off tax reduction of € 5 billion in 2016 will no longer play a role, together with the increase in healthcare insurance premiums and rising inflation[1].

Despite this positive outlook, there are still a number of factors that may have a negative impact on economic growth. Prime point of uncertainty is the upcoming parliamentary elections. International developments are also likely to lead to more uncertainty with questions like what is the likely outcome of the elections in Germany and France, what impact will the new US president have, how will the Brexit negotiations go and what impact will refugee flows and terrorism have this year?

Residential market

Like the economic outlook, the forecast for the residential market is positive for 2017. Economic growth combined with low unemployment will ensure undiminished demand for both rental and owner-occupier houses. The shrinking residential supply and the limited additions to new-build stock are expected to lead to house price increases in 2017. These price increases will be considerably higher in strong urban areas. This will lead to pressure on affordability in the longer term and more and more families are forced to abandon the city altogether for surrounding areas or to accept to live in houses that do not meet all their requirements, but are affordable.

Investment market

The residential real estate market will continue to be an attractive asset class to invest in this year. The supply of rental houses is smaller than the demand and these houses are therefore scarce. This is due to the fact that too few new-build rental houses are being built to meet demand. On top of this, housing corporations now have to allocate houses in the regulated segment on a strict income basis. This means that the majority of rental houses are not accessible to households with lower median incomes above the social threshold. At the same time, these households earn too little to qualify for an owner-occupier house. This is putting pressure on the liberalised rental sector. Thanks to the increasing demand and the plentiful supply of capital, the prices of rental houses are expected to continue to increase. And thanks to low interest rates, the growth in the number of households and the attractive risk-return profile, an increasing number of investors are expected to enter the market, including both foreign investors and new Dutch investors.

The outlook for 2017



Economic growth and low interest rates will help increase consumer spending and investments

Higher purchasing power

Global developments such as terrorism and refugee flows create a climate of uncertainty


Drop in unemployment

High consumer confidence

Uncertain international economic situation due to factors such as the new US President, Brexit and elections in several European countries


Increase in inflation and long-term interest rates

Rental market

Shortage of houses in the mid rental segment, especially in strong regions

Segment above € 1,000 remains a (regional) niche market outside strong urban areas

Long-term perspective of shrinking regions


Qualitative living requirements (increase in singles and retirees)

Production construction sector is gaining pace

Relatively low inflation limits annual rental growth


Housing corporations are increasingly focusing on their primary task and allocate houses according to strict criteria (houses with a rental cap)


Liberalisation limit has been frozen


Increase in the number of target groups looking to rent


Owner-occupier market

Economically strong regions recover more strongly and see more value growth than other regions

Number of households with negative equity is falling

Mortgage rules will be tightened even further


Low interest rates


Investment market

Interest from private investors makes complex sales easier

Limited supply of complexes and portfolios from housing corporations

Competition from foreign investors with different risk/return profile


Competition from institutional and private investors

    • 1CPB Policy paper December 2016