Buy-to-let investors on the Dutch residential market: a study on pricing and capitalization rates
The advent of the ‘buy-to-let’ (BTL) phenomenon in the Netherlands, apart from producing a new wave of private investment, has been widely argued to be a speculative and destabilizing force in the housing market. This thesis presents a detailed empirical investigation of private investment in the entire Dutch residential market. In order to study the relationship between house prices and BTL investment, a quantitative approach is used. Data provided by Dynamis B.V. serves as the main input for these analyses to assess the nature and scale of BTL. The quantitative analyses, however, are informed by a real estate agent interview that investigates the underlying motivations of BTL investors. An explicit and in-depth connection between pricing and how this is driven by BTL investment sentiment is made by analysing
capitalization rates. The results provide evidence that in the Netherlands overall there is no case of structural price premium paid by investors, the price premium paid by investors does however largely occur in Amsterdam and The Hague. The results have implications for housing
market policies, including those targeted at first-time-buyers (FTBs), who may compete for similar properties as BTL investors do.