Free rental sector in the Netherlands is a mess (but what’s the solution?!)

The many tales of the housing crisis in the Netherlands never ends. This has been an ongoing crisis leading to less access to affordable housing even outside Randstad.

Of course, the president of De Nederlandsche Bank (DNB) Klaas Knot didn’t directly say the free rental sector is a big steaming pile of **** in the Netherlands.

He proposed to relieve some of the pressure on the housing market by concentrating more on the free rental sector. He called it the “neglected child” of the housing market and said that the bigger the free sector, the less pressure on social rent and the purchasing sector.

After World War 2, 60% of the housing market was part of the free market sector, says Knot. Today, out of 43% of the total rented housing in the Dutch housing stock, a whopping 83% belongs to the social sector.

The housing shortage in the Netherlands

There is a huge housing shortage where there are not enough houses being built. According to the Housing Agenda (nationale woonagende) presented last year, 75,000 homes need to be build each year to meet the market demands. However, according to ABF Research, 73,000 homes entered the housing stock in 2018. This number needs to be taken with a pinch of salt as it was largely based on the number of building permits that were granted, as opposed to completed homes. In addition, according to a Capital Value survey, there is a shortage of construction sites.

This housing shortage definitely does not help the crisis and reduces the number of houses available to rent in the housing stock.

Mortgage in the Netherlands

Additionally, as it has become increasingly more attractive to buy houses rather than rent them, Knot would like to see the opposite happen to improve the free rental sector. Homeownership means there are fewer houses in the free rental sector, unless they want to rent them out. He admitted that it would be a good thing due to the high mortgage debt of the Netherlands, and he wants to get rid of the mortgage interest deduction. He believes that this has played a big role in the current housing crisis.

What do you think about shifting interests towards renting, rather than buying? Do you think this would help the housing crisis? Or do you think this would just make it harder to find a place to rent? Let us know in the comments!

To understand more about the differences between the free rental sector and the social sector, we have a guide here to help you! Or are you a homeowner who wants to relieve some of that pressure on the social sector? Check out our tips to renting out your home! Or if you’re looking to become a homeowner, check this article for what has changed in 2019!

Kavana Desai
Kavana Desai
Coping with the aftermath of her 3-year stint in the Netherlands, Kavana is a writer, content creator and editor for DutchReview. Hailing from India, she frequently blogs about the Netherlands, being Indian in the Netherlands, and everything in between. She envisions herself to one day be the youngest person to win that Nobel Prize for Literature (she is also not very humble but welcomes only constructive criticism). In the meantime, she fills her days with writing for DutchReview, writing her master's thesis on art theft, and writing fiction that will hopefully see the light of day soon.


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