The housing market in the Dutch capital of Amsterdam is like a microwave that could easily overheat, a new report warns.
House prices in Amsterdam rose sharply in the first three months of this year, according to the Dutch estate agents’ association NVM.
The organisation had expected the market to cool in 2016 following 2015’s growth. But with more than 35,000 homes changing hands during the first three months of this year, property prices in the city have continued to rise and are now up to 20% higher than a year ago.
The average price of a home in Amsterdam has increased by 5.5% to €225,000 (£175,000) and is now just 9% below the 2008 peak.
“The market here is literally boiling over,” NVM chairman Ger Hukker said in a statement. “Consumers are paying increasingly high prices for homes in old city centres.”
Many property investors familiar with the Dutch housing market may be surprised with the level of property price growth recorded in Amsterdam given the recent scaling back of stimulus measures and stricter lending criteria.