Netherlands Luxury Residential Real Estate Market Size

Netherlands Luxury Residential Real Estate Market Analysis

The Netherlands Luxury Residential Real Estate Market is around USD 4.2 billion in the current year and is anticipated to register a CAGR of over 5% during the forecast period.

• The luxury residential real estate market increased in the past three years due to the COVID-19 pandemic. The demand for luxury properties grew much faster than the residential market. COVID led to a renewed focus on living spaces. Affluent people are no longer looking at real estate as just an investment. They are looking for living spaces where they can experience the serenity and enjoy outdoor spaces such as gardens and terraces rather than indoor spaces. Also, many people in the middle class are searching for better homes that encourage work-from-home policies.
• The growth in the market is driven by the growing number of High Net Worth Individuals (HNWIs). These HNWIs want to diversify their portfolio with non-traditional investments instead of equities and bonds, including luxury real estate. Investors in the Netherlands buy luxury property for two main reasons. First, for leisure purposes - owning a holiday home they can use in their free time and second, to earn an income. They buy property for rental income and capital gains. The number of people buying luxury real estate for rental income increased in the past 2-3 years.
• The increasing popularity of micro-trips also impacted the luxury homes market. Micro-travel - a short trip of fewer than five days - is one of the hottest trends in the luxury travel market. Therefore, seeking rental income from luxury real estate is the obvious choice for investors. Luxury real estate buyers looking for rental income prefer investing in apartments rather than villas, mansions, or detached houses. Luxury property buyers prefer residential real estate in central areas of cities rather than suburbs.