As banks have become less accessible for providing loans for the purchase, development, and optimisation of real estate, alternative financing options are on the rise. The increase in the number of alternative products has created an opaque and complex financial landscape, according to research by ‘De Dag van de Intermediair’ among Dutch intermediaries. 85% of them expect that their role as independent advisors will become more urgent in the coming years for this reason.
In recent months, a new Dutch community of intermediaries, ‘De Dag van de Intermediair,’ conducted research on the trends and developments in the real estate market and the intermediary profession. The organisation, an initiative of LVDH Finance, surveyed over 500 intermediaries for their forecasts. Below are the main findings.
Non-Bank vs. Bank Financing
According to the respondents, real estate developers can currently still go to banks for loans or mortgages for financing real estate projects in 60% of cases. It is expected that this percentage will decrease in the coming years. No less than 81% believe that the share of non-bank financing versus bank financing will increase.
The reason for this expectation is that banks, due to increased regulations, compliance, and a lack of flexibility, will not become more accessible in providing capital, or that accessibility will even decrease (70%).
While bank financing is still the most used form of financing, bridge financing through alternative parties is in second place. It is expected that the use of this form of real estate financing will further increase in the coming years. Reasons for this include the lower barriers compared to banks and the flexibility and speed offered by these parties. Means such as crowdfunding, personal networks, or own capital are still rarely used to date.
Growing Need for Intermediaries
The growing number of alternative financing options in the real estate market goes hand in hand with an increasing importance of the role of intermediaries who are active in mediating between real estate developers and investors.
An increase in the number of products, the diversity of offerings, and changed regulations in the real estate market make the market and financial landscape more complex. The intermediary, due to their independent nature and knowledge of the various options, will become more significant. This is underscored by 85% of the respondents.
Conditions for a Healthy Real Estate Market
Access to financing is seen by respondents as the number one factor in creating a healthy real estate market. Additionally, they emphasise the importance of easier processes for obtaining necessary permits from municipalities and a reduction in interest rates for financing. Access to alternative financing, with an increase in the number of providers, is not seen as a risk, nor are the high costs for materials and contractors.
It is important that in addition to the supply of short-term alternative financing forms, long-term financing options are also added to the supply. Over 92% of the respondents see a strong need in the market for financing of five years or more.
About ‘De Dag van de Intermediair’
‘De Dag van de Intermediair’ is a national community of intermediaries active in real estate with the aim of promoting knowledge sharing and connection in the field. The community was established in 2024 by LVDH Finance, a specialist in financing for the purchase, development, and optimization of real estate.
On June 27, the first edition of the annual event will be organised in the form of a multi-course dinner with Jort Kelder as the keynote speaker.
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