Why Amsterdam Residents Are Moving to Rotterdam and The Hague as Housing Prices Soar

Why Amsterdam Residents Are Moving to Rotterdam and The Hague as Housing Prices Soar

For many Amsterdammers, finding an affordable home in the Dutch capital has become a near-impossible task. With average transaction prices climbing by almost 10% nationwide in the first quarter of this year, and far steeper increases in major cities, prospective buyers are expanding their search to Rotterdam and The Hague. Both cities have seen double-digit price jumps—24% in The Hague and 15% in Rotterdam—according to the Dutch Realtors Association (NVM). This trend reflects a broader supply-and-demand imbalance that is reshaping the Dutch housing landscape.

Price Surge in Major Dutch Cities

In Q1 2023, the national average sale price for a home in the Netherlands reached €273,000, up 9.7% year-on-year. However, in The Hague and Rotterdam, the market heat is even greater:

• The Hague: 24% increase in average sale prices.
• Rotterdam: 15% increase in average sale prices.

While these figures highlight rapid value acceleration, they also spotlight housing affordability challenges. Many former Amsterdam home-seekers view these neighbouring cities as viable alternatives, drawn by slightly lower entry-level prices and diverse neighbourhoods with good transport links back to the capital.

Supply Crunch and Buyer Choices

The shortage of available properties compounds the affordability crisis. In the first quarter, the total supply of homes for sale fell by more than one third to just 73,000 listings. That translates to an average of only 4.5 suitable homes per buyer, compared to 6.1 a year earlier. With fewer options, buyers often have to compromise on size, location or condition, intensifying competition.

Consequently, transactions dipped by 13% year-on-year, with NVM brokers reporting just 33,800 homes sold in Q1. Apartment sales were hit hardest, plummeting by 19%. The entry-level market is shrinking fastest: homes priced under €150,000 saw a 40% drop in sales, while those in the €150,000–€200,000 and €200,000–€250,000 bands declined by 19% and 16%, respectively.

Impact on First-Time Buyers and Starters

First-time buyers and younger households are feeling the squeeze. As affordable options disappear, many are forced to search further afield or settle for smaller apartments. Starters often lack the budget to compete with established homeowners who can offer higher bids, or with private investors who buy en masse.

In cities like Groningen and Maastricht—popular with students—up to 30% of properties are snapped up by private investors looking to rent them out. Even in Amsterdam, Rotterdam and The Hague, about 20% of sales involve buy-to-let investors, pushing modestly priced homes out of reach for those hoping to buy their first property.

Role of Private Investors

Private investors now account for nearly one in ten home purchases nationwide. By focusing on smaller, more affordable properties, they reduce the stock available to owner-occupiers and drive prices up. The NVM warns that this trend continues to distort market dynamics, making it harder for families and solo buyers to secure a foothold in homeownership.

While landlords contribute to the rental supply, their concentration on certain segments can leave gaps elsewhere. Balanced policy measures are needed to ensure investors complement, rather than compete with, genuine home-seekers.

Potential Solutions to Alleviate the Crisis

The NVM—and many housing experts—urge a multifaceted approach to stabilise the Dutch housing market:

1. Speeding Up Planning Procedures: Shorten destination procedures for both inner cities and peripheral areas to accelerate new construction.
2. Repurposing Existing Buildings: Convert surplus commercial and agricultural real estate into residential units to add supply quickly.
3. Diversifying Housing Stock: Build for all income levels and household sizes rather than over-emphasising micro-apartments.
4. Incentivising Homeowners to Trade Up: Encourage homeowners to sell their current properties once they purchase larger homes, freeing up starter homes for first-timers.
5. Regulating Investor Purchases: Consider measures that balance buy-to-let investment with access for owner-occupiers, such as purchase caps or differentiated taxes.

Implementing these steps could help stabilise prices, expand choices for buyers, and maintain healthy market activity across all Dutch regions.

Looking Ahead: Market Outlook

Without decisive action, the NVM predicts further declines in transaction volumes and property listings, which would fuel even sharper price increases. As housing affordability worsens, more Amsterdammers may relocate to Rotterdam, The Hague and beyond, reshaping regional demographics and commuting patterns.

Yet these shifts also offer opportunities. Rotterdam’s modern development zones, The Hague’s international community, and emerging hubs in Utrecht or Eindhoven can attract new residents, businesses and infrastructure investment. A balanced housing policy can channel this momentum into sustainable growth across the Netherlands.

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