The Peak (Hong Kong) - - Portfolio -

The best way to visit the Dutch cap­i­tal of Am­s­ter­dam is to view it from the wa­ter. A boat tour in a wooden river launch will take you on a gen­tle jour­ney through the city’s tree-lined canals, past the stone­fronted man­sions and dec­o­ra­tive brick fa­cades that make up the heart of the 17th and 18th cen­tury Dutch cap­i­tal – and its most de­sir­able real es­tate.

The Dutch cap­i­tal is known as the Venice of the North for a rea­son. Its gra­cious canal houses – now a Unesco World Her­itage site – its mu­se­ums and its easy way of life have made the city a mag­net for both tourists and lo­cals. Am­s­ter­dam is a con­stant fac­tor in in­ter­na­tional rank­ings about world’s best places to live and do busi­ness. Last year, 143 for­eign firms made the move to the Dutch cap­i­tal and its sur­round­ing ar­eas, bring­ing 2,700 jobs with them. English is widely spo­ken in Am­s­ter­dam.

Like Dublin and Ber­lin, Am­s­ter­dam also en­joys the favours of the tech in­dus­try. Uber, Net­flix and Ama­zon all have head­quar­ters in the city. The Nether­lands has also been the source of nu­mer­ous en­gi­neer­ing-based start ups, many fo­cused on green busi­ness and sus­tain­abil­ity. Am­s­ter­dam has also been at the fore­front of smart city de­vel­op­ment – The Edge, widely re­garded as the world’s smartest and most sus­tain­able build­ing, is in the city. Fur­ther­more, the de­vel­oper of The Edge has just spun off Edge Tech­nolo­gies, to de­velop a “new gen­er­a­tion of build­ings”.

Prop­erty prices in Am­s­ter­dam are catch­ing up to the ac­tion, hav­ing soared in re­cent years and fi­nally sur­pass­ing their height be­fore the 2008 Global Fi­nan­cial Cri­sis. Fig­ures from CBS, the na­tional sta­tis­tics of­fice, show that the av­er­age ask­ing price for a home in Am­s­ter­dam is now €506,000 (HK$ 4,878,500). Tiny flats in the 19th cen­tury ar­eas west and east of the old city, dis­tricts once con­sid­ered be­yond the pale, are chang­ing hands for prices near­ing €400,000.


The Am­s­ter­dam mar­ket is ex­tremely over­heated and has been for the past cou­ple of years, says Sven Heinen, chair­man of the Am­s­ter­dam real es­tate agents’ as­so­ci­a­tion, MVA. “There is a lot of de­mand, but a real lack of sup­ply, and we are now see­ing a re­duc­tion in the num­ber of trans­ac­tions,” he says. “It is a very dif­fi­cult mar­ket for buy­ers and agents but a great one for sell­ers of course.”

The price rise dates back to the end of 2013, when the Nether­lands fully emerged from the eco­nomic cri­sis. House prices in Am­s­ter­dam have risen by up to 25 per cent since then, as peo­ple who had been trapped by neg­a­tive eq­uity and were un­able to move, could sud­denly do so. Record low in­ter­est rates have also had an im­pact.

What re­ally typ­i­fies the Am­s­ter­dam real es­tate mar­ket is the dom­i­nant po­si­tion given to so­cial hous­ing – some 60 per cent of the city’s hous­ing stock is rent­con­trolled, com­pris­ing homes with a rent of up to €710 a month.

This squeeze on what are known as “free sec­tor” homes – flats out­side the so­cial sec­tor – means that teach­ers, po­lice­men and nurses are be­ing forced out of the city. Some steps are be­ing taken to rem­edy the sit­u­a­tion, but af­ford­able hous­ing con­tin­ues to be the hot topic these days. De­vel­op­ers have, for ex­am­ple, been given the green light to build large com­plexes of mi­cro-homes or stu­dio flats aimed at young pro­fes­sion­als, com­plete with gyms, cafes and state-of-the-art Wi-fi – of­ten in prime lo­ca­tions.

City de­vel­op­ment guide­lines state that 40 per cent of new prop­er­ties must fall into the so­cial hous­ing sec­tor, a fur­ther 40 per cent must be what is known as mid­dle in­come prop­er­ties – up to around €1,200 to rent – and the rest, just 20 per cent – is for owner oc­cu­piers or pri­vate in­vestors with more money to spend. These rig­or­ous rules, im­ple­mented in 2017, have been made pos­si­ble by


the fact that the city it­self owns most of the land – lease­hold is ex­tremely com­mon.

“We want to cre­ate a mixed city, where poor and rich live side by side and that is a de­lib­er­ate part of our pol­icy,” said Lex Brans, the city’s di­rec­tor of real es­tate mar­ket­ing. “We don’t want homes where rents are too high. Am­s­ter­dam must re­main an in­clu­sive city.”


The lack of land for new build­ing does not mean that Am­s­ter­dam’s build­ings are get­ting taller. The city sky­line is typ­i­fied by the lack of high-rise build­ings that you might ex­pect in a modern me­trop­o­lis. This, again, is due

to strict zon­ing laws and rules ban­ning build­ings of over 60 me­tres in many ar­eas. The few lux­ury high-rise prop­er­ties to come on the books in Am­s­ter­dam are be­ing snapped up as quickly as they are be­ing built. Pontsteiger, over­look­ing the Am­s­ter­dam wa­ter­front, is one ex­am­ple of an iconic new build­ing – a huge square arch fram­ing the wa­ter­way and pro­vid­ing ter­rific views over the city. There can be lit­tle won­der then that the two pent­houses were quickly snapped up by an Am­s­ter­dam en­tre­pre­neur, who is con­vert­ing them into one panoramic home.

Ex­perts sug­gest the city needs to build far more than the 6,500 homes cur­rently com­pleted ev­ery year to catch up with de­mand – the city’s pop­u­la­tion is fore­cast to top one mil­lion by 2034 and

is cur­rently grow­ing by 10,000 a year. “Build­ing is go­ing on but it is too late and not enough,” says Mie-lan Kok, a city es­tate agent who spe­cialises in help­ing ex­pats buy a home. “Peo­ple re­ally like liv­ing in Am­s­ter­dam and when you com­pare it to other cities, it is still rel­a­tively cheap.”

The city is also grap­pling with its pop­u­lar­ity as a tourist des­ti­na­tion. In par­tic­u­lar, the prac­tice of buy­ing up empty homes and rent­ing them out to tourists via web­sites such as Airbnb has come un­der fire. Am­s­ter­dam was one of the first cities in the world to reach an agree­ment with Airbnb on how many days home­own­ers can rent out their prop­er­ties, but the 60 day limit agreed in 2016 is to be cut back fur­ther to 30 days.

In Jan­uary, the city joined forces with Barcelona, Vi­enna and Paris to urge the Euro­pean Com­mis­sion to bet­ter reg­u­late the lu­cra­tive hol­i­day mar­ket by forc­ing Airbnb and other plat­forms to share their data with the cities them­selves. Cam­paign­ers say that the lu­cra­tive in­come from hol­i­day ren­tals means houses are not be­ing put back onto the mar­ket when peo­ple ei­ther move or set up home to­gether.

As well as the over­all short­age of hous­ing in ev­ery price class, the sim­ple lack of space is an­other ma­jor is­sue. “Some 80 per cent of homes within the Am­s­ter­dam ring road are smaller than 80 square me­tres, and there are very few fam­ily homes,” says Heinen. “If you are look­ing for three or four bed­rooms you are look­ing


– Lex Brans, City of Am­s­ter­dam

for at least 120 square me­tres and more… then you are look­ing at up­wards of €1 mil­lion. If you are look­ing to buy a fam­ily home in the canal area it­self, then buy­ers have to be pre­pared to pay much more than that.”


Not only are Am­s­ter­dam houses small, but they are also of­ten lack­ing in bath­rooms when seen through for­eign­ers’ eyes. Show­ers are more com­mon than baths, and the small toi­let off the hall with its tiny sink with no hot wa­ter are the butt of many an ex­pat joke. “If we are talk­ing high end, then peo­ple want two or three bath­rooms, they want more san­i­tary pro­vi­sions than the Dutch,” says the MVA’S Heinen. The Dutch, by con­trast, want out­side space. “Peo­ple from abroad who are look­ing at the up­per end of the mar­ket are used to spend­ing time in the park, so they are not that both­ered about a roof ter­race or a large bal­cony,” he says. “They also con­sider a park­ing place to be es­sen­tial, as well as a lift.”

Se­cu­rity is an­other is­sue. In­ter­com sys­tems are be­com­ing more com­mon, but a ground floor door­man is a rar­ity. “My Asian clients in par­tic­u­lar are used to hav­ing good home se­cu­rity and are used to there be­ing a concierge,” says Kok. “I have to ex­plain to them that Am­s­ter­dam is a safe place to live and we just don’t have them (home se­cu­rity fea­tures).”

Of course, homes which in­clude the req­ui­site num­ber of bath­rooms, se­cu­rity and lifts can be found, but at a price. The real top end – the hid­den gems – get sold in se­cret for sums of €6 mil­lion and higher. These are the houses that are bought by tele­vi­sion celebri­ties or top-level ex­ec­u­tives, and they want to keep it quiet. Luck­ily, Am­s­ter­dammers are very de­fen­sive of their pri­vacy.

“If you want some­thing ex­clu­sive, you need to work with an es­tate agent be­cause they know what is out there,” said Mar­i­anne Joanknecht, a bro­ker with Sotheby’s In­ter­na­tional, which has a spe­cialised of­fice in Am­s­ter­dam. “Peo­ple with homes in the most ex­pen­sive seg­ments don’t want it to be known that their prop­erty is up for sale.”

Joanknecht fo­cuses on this up­per end of the mar­ket and says even the Pontsteiger de­vel­op­ment can be con­sid­ered too far out of town. “What peo­ple want is the Dutch her­itage, the canals, and there are only a lim­ited num­ber of those prop­er­ties,” says Joanknecht. The area around the Ri­jksmu­seum, voted one of the best mu­se­ums in the world, and the main city park, the Von­del­park, are also ex­tremely sought af­ter for larger fam­ily homes, she said.

“I would al­ways ask po­ten­tial buy­ers if they re­ally want to be in the canal district,” Heinen said. “Peo­ple have this idea about what liv­ing in Am­s­ter­dam should be. But they should look in other parts of the city too. In Zuid, the south­ern district de­vel­oped around the end of the 19th cen­tury, you’ve got more choice and you are still within cy­cling dis­tance of all the main at­trac­tions.”

Then again, if you want ev­ery­thing in walk­ing dis­tance, a pic­turesque canal house awaits you.


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