EIB warns of declining housing supply from building transformations

The Economic Institute for the Construction (EIB) reports that policymakers are overestimating the contribution of building transformations, unit splitting, and adding floors to the housing supply. While the Netherlands requires approximately 100,000 new homes annually to meet demand, the net additions from existing stock are declining.

Net additions from transformations and renovations fell from roughly 14,000–16,000 units in 2020–2021 to fewer than 12,000 in 2024. The EIB estimates the 2025 contribution from existing stock will be just over 10,000 units, below the 2019–2025 average of 13,000.

A significant decline is noted in the transformation of offices, shops, and other buildings into residential units. While the policy ambition is approximately 15,000 transformations per year, the EIB projects only about 6,500 for 2025. The institute suggests that many easily transformable buildings have already been utilized, leaving behind properties in less suitable locations or those with high renovation costs.