The Netherlands in the top 3 for investments in rented housing

This is according to a survey carried out by Capital Value among a large number of international investors, the initial results of which will be presented during the Expo Real in Munich. More than 200 international property investors were approached for the survey, including investors from the United States, Germany, England and Switzerland. It is the first time that such a large-scale survey of the European residential market has been carried out.

The Netherlands in a strong third place
Whereas until a few years ago cross-border investment in rented residential property was limited mainly to Germany, investors are increasingly showing interest in other countries. During the past two years there have been major cross-border transactions in Scandinavia, with Denmark being particularly popular. Some 350 million euros were invested in the country by international parties in 2012. Now it appears that it is the turn of the Netherlands. Research by Capital Value shows that the Netherlands, after Germany and Denmark, occupies a strong third place on the list of countries in Europe in which investors want to invest in the coming years.

Volumes from 50 million euros
Likely shortages on the Dutch housing market and the good return-risk ratio are regarded as an opportunity by an increasing number of foreign parties. As house prices have fallen and with the expectation that the market will begin to pick up again, investors anticipate extra opportunities in the Netherlands. Many investors compare the Netherlands to Germany in the early 2000s. Due to the huge price rises in Germany during the past few years, investors believe that better returns can now be achieved in the Netherlands. Capital Value expects that a number of transactions with foreign investors will take place during the remainder of 2013.

Alexander J. van der Laan, property advisor at Capital Value in London: ‘A large number of foreign parties are exploring the Dutch housing market with serious intent. There is particular interest in large volumes from 50 million euros upwards. We are seeing clear differences between Anglo-Saxon parties and investors from Germany. German investors tend to take a long-term view and go for a stable return, whereas Anglo-Saxon investors are particularly interested in large volumes with a high return.’

Share of residential property in the total portfolio is rising
What is particularly striking is that the parties who currently do not invest in residential property are now looking at the Dutch rented housing market. Among the investors surveyed who already invest in residential property, the majority expect to increase the share of residential property compared to other segments during the coming years.

We can therefore expect the number of transactions with international parties to increase significantly during the coming years, which may potentially lead to billions in extra investment in the Dutch residential investment market.

Ing. Marijn A. Snijders, RT MRICS: ‘We feel that this strong interest from foreign investors is an extremely positive development. These parties complement the Dutch private and institutional residential investors. Since housing associations in the Netherlands can now sell off entire property complexes, we are seeing the volume of supply increase too. Foreign capital can certainly make a positive contribution to the Dutch housing market.’