The problem is that people chronically overestimate the number of foreign buyers in the market. I can't find data for the Netherlands online, but for other western nations, it is around four or five percent of demand. Removing that will have essentially no noticable impact on housing prices as NZ has learned.
The advantage of a foreign ban is political in nature. Foreigners can't vote in local elections, so politicians lose very little, and the actual electorate is satisfied that government is 'doing something' about the problem.
It's a no lose situation for the politician, but at best it does nothing to reign in the issue of housing costs, and at worst it fans the flames of xenophobia.
That is real estate investment flow. That's not the same thing as housing. The graph you linked shows the majority of the investment going into things like office space, industrial real estate, retail, hotels, healthcare, etc...
It must also be noted that the vast majority of these deals aren't homes on the market for locals, they're existing investor real estate.
Sometimes you see articles stating '25% of all homes last year were bought by investors', but failing to mention that 20% of that 25% were homes sold by investors, too. i.e. company A selling to company B, an apartment block fully rented out. Sometimes company A and B are part of the same group structure, and they're simply restructuring. And so really the percentage of investors buying homes that could otherwise be bought by citizens, is actually only 5%.
Secondly, there's a lot of international capital flowing in because capital is extremely mobile and knows no borders. It doesn't mean foreigners own the real estate. Everytime a Dutch investor (e.g. a Dutch pension fund) buys real estate, it typically finances it with a combination of its own money and borrowed money, and the borrowed capital is typically raised on international financial markets.
I find the news is quite unsophisticated in detailing these nuances, and typically chooses the most incendiary headline that they can get away with.
e.g. "25% of homes bought by foreign investors." or hell even "50% of real estate bought by foreign investors", instead of 5% of available homes bought-up by Dutch pension funds", all three statements could be based on the same data-set.
No, that's not the claim. There's waterbed effects. Buy-to-let is done for the purpose of renting. If you take that rental supply away, rental prices go up, and demand for homes go up. Taking away buy-to-let demand thereby creates other demand that buy-to-let was supplying. You're just replacing the demand, not removing it.
It does just move supply/demand around, that's the waterbed effect.
If you remove buy-to-let investors, then buying a home becomes easier, but not necessarily any cheaper, because the rental supply (from buy-to-let) drops and therefore the prices of rentals go up, thereby increasing the demand for buying a home, countering the lower demand from buy-to-let investors. Demand has been moved around, the shortages are still as big, and there's no significant effect on prices.
https://i.stuff.co.nz/life-style/homed/119636052/foreign-buy...
The problem is that people chronically overestimate the number of foreign buyers in the market. I can't find data for the Netherlands online, but for other western nations, it is around four or five percent of demand. Removing that will have essentially no noticable impact on housing prices as NZ has learned.
The advantage of a foreign ban is political in nature. Foreigners can't vote in local elections, so politicians lose very little, and the actual electorate is satisfied that government is 'doing something' about the problem.
It's a no lose situation for the politician, but at best it does nothing to reign in the issue of housing costs, and at worst it fans the flames of xenophobia.