Amsterdam’s housing market risks heading in the same direction as London or Paris unless radical steps are taken to meet the surge in demand, the leader of the city’s estate agents has warned in a farewell speech.

Sven Heinen said intense competition and a shortage of new homes for sale were the main reasons for prices in the capital going up by as much as 20 per cent a year since the recovery began in 2013.

The 45-year-old is stepping down after five years as chairman of the city’s association of estate agents (MvA).

‘In terms of prices we are heading the same way as London or Paris if we keep thinking within the framework of small municipalities,’ he told the Volkskrant. ‘The solution lies in developing the metropolitan area – Amsterdam and its surroundings. People have to spread out more. That’s only possible if we make big moves in infrastructrure, especially in public transport around Amsterdam but really across the Randstad area.’

Heinen said he had first hand experience of the problem when he tried to move his family into a larger house. ‘My girlfriend and I didn’t really want to leave Amsterdam. We wanted a house with a garden on its own land. But that turned out to be unaffordable… In the end a fellow estate agent tipped me off about the building projects in Diemen, which is really just east Amsterdam, the end of tram line 19 is just beyond here.’

Heinen also criticised the city council’s policy of concentrating on building social housing as too restrictive and worsening the overheating market. ‘Before the election last year I heard a lot of investors with property in Amsterdam say the council administration couldn’t be left-wing enough for them. Because a left-wing approach means more social housing, fewer houses for sale become and higher prices. The overheating of the housing market is a consequence of 30 years of left-wing housing policy in Amsterdam.’

He said the solution to the problem lay in removing restrictions on housing corporations so that they could build houses for the mid-rent sector and for sale, abolishing the tax on landlords and building on land beyond the A10 ring road.

‘Unfortunately Amsterdam is placing restrictions in increasing numbers of places on the growth in the number of small houses, whether through new build or splitting up properties. If supply doesn’t grow to meet demand, that means prices will continue to increase.’