Amsterdam Housing and Coronavirus

by James Evans, 28th September 2020

Since the outbreak of Covid-19 at the beginning of this year, the population of Amsterdam has been shrinking. Between March and July 2020, the population decreased by almost 4,000 inhabitants. This reduction in demand represents a significant change in the trend with the past because, in the past ten years, the population has consistently grown by about 10,000 inhabitants per year. Has Amsterdam lost its popularity? And what does this mean for the Amsterdam real estate market, where prices have risen much more sharply in recent years than outside?


The excess mortality as a result of the virus explains only a fraction of the population decline. Scientists and trend watchers were quick to point out the rediscovery of the countryside as a major reason. After all, many urban facilities suddenly disappeared during the lockdown. Cultural life and the catering industry have been forced to close and the parks soon turned out to be too full. In the countryside, however, there was plenty of space and working from home proved to be an excellent alternative with the support of video calling services.

Head to the countryside?
Around me, I noticed that the idea of new migration to the countryside was being embraced by many. Usually supported with 'facts', namely that 'they also knew a family that exchanged the city for the countryside'. And I also saw that this caused uncertainty among real estate investors with investment strategies aimed at further urbanisation and globalisation.

Immigration stopped
However, if you look more closely at the figures, you will see that something else is going on. No more households are leaving the city, but immigration has stopped. Immigration has been the driving force behind population growth in recent years. Especially highly skilled workers and international students from India, the United States and Britain went to Amsterdam. Due to the coronavirus, these people cannot - at least for now - come to the Netherlands. It is a matter of time before immigration gets going again, as companies look across borders for top talent and international work experience is still aspired by many.

The Attraction of the City
Also, cities continue to be very attractive to young Dutch people from all over the world. They come for their education or career. They meet a partner and often have their first child while still living in the city. In our cities, many more people are born than die. Then these new families move to the suburbs. The fact is that 60% of moves to Amsterdam come from outside a radius of 30 kilometres around the city and that 60% of moves from Amsterdam remain within a radius of 30 kilometres. In other words: young people from all over the country come to Amsterdam and a large part of these people then continue to live within the metropolitan region. These dynamics have not changed during the pandemic.
The corona crisis has shown us, that many office jobs can be done from home. The commuting distance thus becomes slightly less important in the choice of housing. However, we have now discovered that a few days a week in the office is essential for healthy variety and creative collaboration and connection with colleagues. Moreover, cities remain attractive for the cultural life, the catering industry and the dense social network they harbour.

The Attraction of the City
Also, cities continue to be very attractive to young Dutch people from all over the world. They come for their education or career. They meet a partner and often have their first child while still living in the city. In our cities, many more people are born than die. Then these new families move to the suburbs. The fact is that 60% of moves to Amsterdam come from outside a radius of 30 kilometres around the city and that 60% of moves from Amsterdam remain within a radius of 30 kilometres. In other words: young people from all over the country come to Amsterdam and a large part of these people then continue to live within the metropolitan region. These dynamics have not changed during the pandemic.
The corona crisis has shown us, that many office jobs can be done from home. The commuting distance thus becomes slightly less important in the choice of housing. However, we have now discovered that a few days a week in the office is essential for healthy variety and creative collaboration and connection with colleagues. Moreover, cities remain attractive for the cultural life, the catering industry and the dense social network they harbour.

Breather
Amsterdam and other cities are experiencing a major but temporary setback due to the disappearance of immigration and tourism. Fortunately, this also gives the city some relief, because the enormous population growth of recent times also posed challenges, such as the affordability of the housing stock, the congestion of traffic and over-consumption in the city centre.
The structural demographic trends are unchanged and at some point immigration will start again. Municipal authorities can use this breathing space to prepare for a return to the old situation. Because making plans to facilitate the continued growth of the city - without the negative side effects of recent years - remains a priority and urgently needed.

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