Dutch government opens rental housing sector to investors

7 October 2014

Blok

Source: PropertyEU | At EXPO REAL 2014, Dutch housing minister Stef Blok said he has made good on many of his plans announced last year for liberalising the rental market and boosting investment in the sector. ‘We managed to implement most of the important legislation for the Dutch housing market to stimulate the free rental sector’, Blok said during a panel on the Netherlands as an investment location at EXPO REAL 2014.  

‘Twelve months on from EXPO REAL 2013 we are seeing growth figures, starting with the economy which in turn is stimulating demand for housing.’ The minister said social housing provided by housing corporations now accounts for a third of the market, while the majority of the population own their own homes. Up to now the non-rent controlled residential sector has been quite small, in contrast to the situation in neighbouring countries. There is currently legislation before parliament to restrict housing corporations to their core task of providing homes for people on lower incomes. ‘This legislation will help create a level playing field in the market an stimulate the private rental sector’, Blok said.

Dutch government opens rental housing sector to investors
The minister also addressed a special session about the opportunities for investors offered by the Dutch residential property market. Tight housing markets form one of the biggest challenges for successful cities as populations grow. Cities need to find new ways to build homes and make sure they are available quickly and Dutch cities, Amsterdam in particular, are no exception. The residential property market in the Netherlands has been on virtual lock-down since the start of the economic crisis, with first-time buyers in particular priced out.

Today, house prices in the Netherlands are down around 20% on 2008, although they are beginning to recover. Regulated housing accounts for 88% of the Dutch rental market, or some 2.7 million homes, but the government believes around one million of these have the potential to move out of the rent-controlled sector, offering excellent opportunities for outside investors. The Dutch government is working to restore the balance between rental housing and the owner-occupied sector, opening up new opportunities. With house prices falling and rents going up, the return on housing investments has improved considerably.    

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