The Dutch housing market might be slowing down, but prices on the rental market are rising at unprecedented rates. According to real estate association NVM, this spring, tenants saw rental prices rise by almost 12 percent – the highest increase since their records began in 2014.
Renting in the Netherlands becoming increasingly expensive
On average, the price per square metre for rental properties in the free sector was 11,8 percent higher in the second quarter of 2022 compared to the same period last year, rising from 13,73 to 15,35 euros.
The price increases were even more shocking amongst new-build properties, rising by over 18 percent to 18,12 euros per square metre. Prices for existing buildings remain slightly lower, rising by 7,5 percent to 14,34 euros per square metre.
“With these price increases, the rental market is becoming increasingly inaccessible,” says Onno Hoes, chair of the NVM, arguing that those looking for a home in the Netherlands are finding it increasingly difficult to rent and buy property.
The Hague, Utrecht, and Amsterdam record biggest price increases
The increase in rental prices was observed across the Netherlands, with prices in the provinces of Groningen and Zeeland also reaching above the national average. The province of Flevoland recorded the most significant increase, with rental prices rising by 27,2 percent over the past year.
As far as municipalities are concerned, Amstelveen recorded the most significant increase (41,1 percent), followed by Almere (31,7 percent) and Groningen (21,8 percent). Of the five biggest Dutch cities, The Hague saw rent prices rise by 11,8 percent, while the increases seen in Amsterdam and Utrecht were slightly smaller (5,1 and 7,4 percent respectively).
Interestingly, both Rotterdam and Haarlem have seen rental prices in the free sector fall between the spring of 2021 and the end of June 2022. Prices decreased by an average of 6,1 percent in Rotterdam, and 5 percent in Haarlem.
Dutch government needs to do more to protect rental market
According to NVM and Vastgoed Management Nederland (VGM NL), the notable increase in prices across the Netherlands can be attributed to a number of factors, including the high inflation rate, rising interest rate, and national housing shortage.
However, Onno Hoes also points out that efforts made by the Dutch government to block investors and support first-time buyers are only serving to make the rental market increasingly unaffordable, especially to those earning average incomes.
“Restrictive regulations for investors and policy intentions regarding rentals…hit the rental market at the heart,” Hoes explains. VGM NL chair, Sander Groot, agrees. “It would be good to create a good investment climate in order to create more supply in the rental sector,” he says. “Despite the advantages of renting, the government is strongly committed to promoting home ownership and investing in real estate for rental seems to be discouraged.”