Trends are shaping the urban housing demand of families

Global trends shaping the housing market 
An analysis by the EU shows that there are seven long-term global trends that influence the housing sector. They are also called global megatrends. We have ranked them according to the three ESG criteria, which are also mentioned in our VanWonen ESG Manifesto.

The growth of single-person households, immigration, and an ageing population are among the demographic factors that many studies explore when analysing long-term trends in the Dutch housing market. These developments shape the future demand for housing. As we will see, demographic trends play out very differently in highly urban areas compared to less urban or non-urban regions.

Key drivers of demographic change

The Dutch population is changing due to demographic factors, which influences the future housing demand as well as housing preferences. The two key drivers of these changes are the ageing population and migration. In the ten largest Dutch cities, several notable trends have emerged:

• AGEING POPULATION While the ageing trend is relatively slower in big cities, the absolute number of households aged 65 or older is growing faster in cities. The number of households in the age range for starting a family, 30 to 44 years, is also growing faster in the big cities. This is due to increasing urbanisation: the city continues to attract households. This isn’t just limited to single people or couples, as is often assumed, but also to families. This is related to migration.

• MIGRATION is the driving factor behind population growth in the Netherlands. While natural increase is declining and was even negative in 2022 and 2023 (more deaths than births), the migration balance is positive and growing (immigration minus emigration). Family migration is the biggest contributor to this annual inflow. This creates more (cultural) diversity. Especially in cities, where the proportion of residents of foreign origin is high. Of the 3.9 million residents in the ten largest cities, 30 percent (1.2 million) were not born in the Netherlands. In the rest of the country, this proportion is 12 percent.
  
  

Make the city more attractive for families to live in 
Global trends such as demographic changes are affecting the demand for housing. While families were still considered the bedrock of society in the last century, they seem to be becoming less relevant in urban developments. Over 80% of new development plans are focused on inner-city areas, with apartments accounting for two-thirds (67%).

There is a mismatch between the planned housing developments and demographic changes. Because of migration, the number of families is increasing in cities, yet the housing options don’t align with their preferences. Ground-oriented houses remain the most common and sought-after housing type for families. Because they positively contribute to healthy and diverse neighbourhoods, families (read: single-family homes) should not be overlooked in urban (re)developments. How are families encouraged to (continue to) live in the city?

In her dissertation Staying in the City or Moving to the Suburbs, Booi demonstrates that the following three demographic characteristics are important factors in the choice of whether or not to remain in the city as a family:

• FAMILY SIZE The larger the family (number of children), the greater the chance of moving to the suburbs of the city or outside the city.

• AGE OF CHILDREN Among urban households, households with young children are the most inclined to leave the city.

• LEVEL OF EDUCATION Families with higher levels of education are more likely to opt for urban living than families with lower levels of education. This may be partly due to the corresponding family income in relation to the (ever-rising) housing prices.

Young households, including (future) families, tend to leave the city. In contrast to pull factors such as access to work, education and other amenities, there are many factors that push families away. Push factors such as traffic congestion, poorer air quality, and an inadequate housing supply often play a decisive role in leaving the city. As a result, the city becomes more homogeneous in terms of population and household composition. Having families in the city, whether it is by attracting new ones or keeping existing ones, leads to more diverse, lively and healthier neighbourhoods. Families provide the social fabric of urban societies. The role of families should therefore not be underestimated.

In a following article, we will delve deeper into the data behind the role of families in the city. What is the proportion of families in urban neighbourhoods? Where do they live now and how would families prefer to live? And to what extent are families actually inclined to move out of the city?

List of full citation.