Annual capital value decline at -7% in Dutch market, says IPD

The pace of capital value depreciation in the Dutch property market has accelerated over the second quarter, at -2.1%, according to the ROZ/IPD Netherlands Quarterly Property Index, up from -1.5% over the first three months of the year.

This continued pressure on capital values brings the 12-month change to -7.0% - a considerable decline for such an historically stable property market. The annual change in capital values in Offices was -9.9%; while it was -6.7% in the Residential market and -5.0% in Retail.

While capital growth decline is shallower than Q4 2008’s decline, at -3.7%, its increase relative to Q1 is the result of further yield expansion. In the three dominant sectors of the Quarterly Index, initial yields all rose over the second quarter; in Retail by 20 basis points to 6.5%, in Offices by 10 basis points to 7.5% and in Residential also by 10 basis points to 4.7%. Notably the yield expansion in Offices was the fourth consecutive quarterly rise.

ROZ director Aart Hordijk: 'On an annual basis, the capital growth of Offices and Industrials - the sectors most sensitive to economic cycles - are both now hovering around -10%. Also, the Residential market, which is the largest segment in the ROZ/IPD Netherlands Quarterly Property Index, has a capital growth of -6.7%.'