Tuesday, 9 February 2016 - 14:25
Cities not building enough rental homes to cope with soaring prices
Cities, corporations and developers are too focused on owner-occupied homes and are not building enough rental homes to cope with the ever increasing rent prices - a disturbing and also unnecessary trend, according to property consultant Capital Value's report The Property Investment Market 2016, the Volkskrant reports. Every year 30 thousand rental homes are built. But due to demolition and rental homes being sold as owner-occupied homes, the supply is at a standstill, or even shrinking. At the same time the demand for rental housing is growing, due to an increase in single-person households and growing migration. The reason for the increase is that more and more people are living alone, the number of single-person households is expected to increase from the current 2.9 million to 3.3 million in 2025. The growing migration is also putting increasing pressure on the housing market, according to the property consultant. Capital Value assumes that 70 thousand new homes will be needed every year due to the increase in households. The number of households are expected to increase from a current 7.7 million to 8.2 million in 2025 and 8.8 million in 2040. That means for the time being there will be a housing shortage. In 2020 there will be a nationwide shortage of 3.7 percent in the total number of homes. The biggest shortages are expected in Amsterdam (8.4 percent) and Utrecht (7.3 percent). Statistics Netherlands recently announced that these two cities' populations are growing at way above the average rate. The number of households that can not buy a home or find an affordable rental property will increase from a current 318 thousand to 326 thousand in 2018. According to Capital Value, this is a completely unnecessary problem, because corporations have the resources to do something about it. Construction output is on the rise. In 2015 licenses were issued for the construction of 58 thousand homes. That number will increase to 70 thousand this year and expected 80 thousand in 2018. And the low supply of rental housing has noting to do with lack of money, according to Capital value. Investors made 5.5 billion euros available for investing in rental housing construction, banks also want to put more money into that.