In an attempt to improve the affordability and accessibility of the Dutch rental market, the government has sent a proposal to the House of Representatives (Tweede Kamer) outlining a plan that should ensure that, from 2024, the majority of new rental contracts signed in the Netherlands will be for rents of below 1.000 euros a month.
Most rental properties in the Netherlands to cost under 1.000 euros
Over the past few years, the Dutch government has faced mounting pressure to tackle the national housing shortage and the rapidly rising cost of housing. With these latest plans, the cabinet hopes that rental properties will become more affordable for middle-income households and that a significant number of new mid-rental homes will be built.
A key part of the proposal involves increasing the threshold for social housing. Currently, a points system – officially titled the woningwaarderingsstelsel (“home valuation system”) – and helps determine rental prices for social housing, with an upper threshold set at 141 points, or 763.47 euros a month. From 2024, this threshold will increase to 187 points, or 1.000 euros, meaning that more properties will be categorised as social housing and fall under the Rent Tribunal’s (Huurcommissie) remit.
Increasing the threshold will not only mean more higher-quality rental properties will be categorised as social housing, but it will also make it harder for landlords of properties in this price bracket to set excessively high rents. The cabinet expects that this change will mean more than 90 percent of the new rental contracts for social and mid-rental properties will be set at or under 1.000 euros.
De Jonge hopes to encourage developers to invest in affordable housing
In order to encourage developers to build more medium-sized rental properties, the government intends to “modernise” the points system “so that it is more in line with the quality of rental homes,” thereby ensuring tenants pay a fair price. The new system is set to be announced later this month.
The government has also outlined targets for the number of new homes that must be built over the coming years. 900.000 new homes will be constructed by 2030, approximately 40 percent of which will be mid-rental homes or affordable housing.
Housing Minister Hugo de Jonge is confident that these plans will help to protect tenants against extortionate rents. “The current scarcity leads to a rapid increase in rents with all the excesses that this entails. We have to get rid of that,” he says.
Cost of renting in the Netherlands falls slightly
Recent figures published by the housing market platform Pararius revealed that, while rental prices have fallen slightly, the cost of renting in the Netherlands remains high. Prices in the free sector rose by 0,6 percent between last summer and the third quarter of 2022, but the average price per square metre has fallen from over 17 euros in the spring to 16,90 euros now.
Pararius chief Jasper de Groot has criticised the government’s approach to the housing crisis, arguing that the government needs to realise the key role investors play in ensuring the supply of affordable housing in the free sector.
“Middle income-earners, but also the self-employed, expats, divorced or single parents; these are all people who often do not qualify for an owner-occupied home because their income does not allow it, but they also cannot claim social housing because their income is too high,” Pararius says.