- The tense geopolitical situation in the Middle East had a noticeable impact on energy prices in April.
- For example, petrol prices have risen further and fixed gas prices have also become more expensive.
- Business Insider, in partnership with news app Upday, tracks seven prices every month that matter to the value of your assets and influence your monthly expenses.
In April, a few more clouds appeared on the horizon for your wallet. The stock market rally has come to a standstill, petrol prices are on the rise and fixed energy contracts have also become slightly more expensive for the first time in a long time.
With regard to fuel prices and gas and electricity prices, geopolitical tension in the Middle East plays a role. This has, among other things, pushed up oil prices somewhat further.
Meanwhile, prices in the housing market continue to rise, while mortgage rates show little movement. For savers, the relatively high inflation is still an obstacle, because it makes it difficult to maintain the purchasing power of savings.
Business Insider, in partnership with news app Upday, tracks seven prices every month that matter to the value of your assets and influence your monthly expenses. View the Look at your Money from April 2024 below.
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House price: significant increase of 5.4% on an annual basis
The average house price rose sharply in March by 5.4 percent on an annual basis, figures from the Central Bureau of Statistics and the Land Registry showed last week. This means that a home has become worth an average of 20,000 euros more in one year.
The average transaction price rose from 415,141 euros in March last year to 435,049 euros last month.
Compared to February, the average house price increased by 0.7 percent. The average transaction price at the time was 427,279 euros.
Earlier this month, the NVM real estate agency association also published the average house prices for the first quarter of 2024.
The NVM relies on the purchase agreements concluded for homes sold by NVM Makelaars, while CBS and Land Registry rely on purchase deeds that are registered with the Land Registry.
Based on the NVM figures, the average house price rose by no less than 9.1 percent on an annual basis to 432,000 euros last quarter.
Also read: House prices are expected to rise even faster in 2024: an average increase of 6%, according to ABN AMRO
Mortgage interest rate: most popular interest rate continues to fluctuate around 3.8%
The average mortgage interest rate did not show much movement in March. The most popular interest rate for mortgages with a 10-year fixed interest period with NHG insurance fluctuated between 3.84 and 3.87 percent.
Last week this interest rate was 3.83 percent, according to data from Financial Intermediary Van Bruggen Adviesgroep. The table above shows the development of the average interest rate for 10-year fixed mortgages with NHG (light blue line) and loans without NHG (dark blue line) of 100 percent of the home value.
Although interest rates have remained more or less the same in recent weeks and house prices are rising, homes will be slightly more affordable this year than in 2023.
This is because mortgage interest rates are slightly lower than in the fourth quarter of 2023. In addition, home buyers in the first quarter of 2024 had a higher average income than last year. Lenders will also apply new mortgage standards in 2024, which will allow some groups of home buyers to borrow more.
Also read: 3 reasons why housing has become slightly more affordable, despite rising house prices
Savings: Inflation again fractionally above highest variable savings interest rate
Savings yielded slightly less in March than in February, as shown in the graph above with data from Spaarinformatie.nl and Statistics Netherlands. The highest variable savings interest rate remained at 3 percent in March, while products and services became 3.1 percent more expensive than in the same period last year. In February that was still 2.8 percent.
Inflation has therefore risen slightly above the highest variable savings interest rate, making it slightly more difficult to maintain the value of savings in March than the month before.
Savings often yield slightly more if they are kept on a deposit for a certain period at a fixed interest rate. For example, the interest rate on the highest savings deposit for 1 year is currently 3.6 percent in the Netherlands.
Also read: An American millennial who became financially independent in her 20s by living extremely frugally says it’s not always necessary to make big sacrifices
Stock market: stock market rally comes to a standstill
After an incredibly strong quarter in the first three months of 2024, the pace of the stock market rally slowed in April. This also applies to the AEX index, which on balance moves almost flat in April. This does not alter the fact that a plus of 12 percent is still expected for the first four months of the year.
A setback for investors is the persistently high inflation, especially in the United States. This means that the US central bank has little room to reduce policy rates in the short term. Interest rates have risen on bond markets this month, putting pressure on the strength of the stock market rally.
The stock market rally in the first quarter of this year was partly based on the assumption that there will be no recession in the US, that inflation will cool down and that interest rates can fall quickly. That story can be put on hold for the time being.
Also read: Will higher interest rates really disrupt the stock market party or will the bulls bounce back?
Gasoline: further increase in April
Oil prices remain at a high level in April, with increased tension between Israel and Iran playing an important role. At the same time, there is not a strong breakout, because Brent oil, for example, has not broken out above 90 dollars per barrel.
Many market parties point out that an escalation of the Israeli-Palestinian conflict is not in the interests of the US, Israel’s main supporter. And not from China, which is a major buyer of Iranian oil. After all, American President Joe Biden is not interested in higher gasoline prices in a crucial election year and China simply wants to continue purchasing oil from Iran.
The global superpowers are therefore exerting pressure from outside to prevent a new oil crisis from arising.
If you look at the development of petrol and diesel prices in the Netherlands, it is striking that the decoupling of the petrol price and the diesel price continues. The petrol price recorded an average of 2.08 euros per liter in the second half of April, an increase of 8 cents since the end of March. Diesel, on the other hand, has remained flat at around 1.80 euros per liter.
Also read: Gasoline is becoming more expensive because OPEC countries are limiting production, energy expert warns
Electricity: variable price is still falling, but 1-year fixed price is rising
Gas and electricity prices appear to be stabilizing in April after a long period of declines. This is especially visible in the divergence between the development of variable prices and rates that are fixed for 1 year.
A look at electricity prices shows that the average variable rate for new customers of energy suppliers in April is 12.17 cents per kWh, excluding energy tax and VAT. That is more than a cent lower than in the previous month.
However, the average rate for 1 year fixed is slightly higher in April than in March at 11.7 cents per kWh, excluding taxes.
“This indicates a beginning of stabilization in some segments of the market,” notes energy expert Ewoud van de Kolk of financial comparator Pricewise.
Also read: Payback time for solar panels is 10 years instead of 4 years due to extra costs, according to comparison site
Gas: geopolitical tension affects long-term contracts
The same movement can be seen on the gas market as on the electricity market.
The average variable gas price for new customers of energy suppliers is 44.13 cents per cubic meter in April, excluding energy tax and VAT. That is 4 cents lower than in the previous month.
For prices that are fixed for 1 year, new customers pay an average of 43 cents per cubic meter in April, excluding taxes. That is almost 4 cents per cubic meter more than in the previous month. So here too there are rising prices for 1-year fixed and falling variable prices.
The increase in longer-term contracts is mainly due to geopolitical tensions due to the conflict in the Middle East, says energy expert Van de Kolk of Pricewise. “As a result, gas purchasing rates have risen for energy suppliers. In addition, gas supplies have been little used due to the mild winter, which means that they are quickly replenished and there is therefore not much need for additional gas in the short term.”
Also read: Significant tax increases are looming for households that use propane gas
