Amsterdam to oblige homeowners to live in homes worth less than €512,000

In an attempt to exclude real estate investors from parts of the Amsterdam housing market, the municipality wants to make it mandatory for homeowners to live in the home they own if it is worth 512,000 euros or less. The municipality intends to introduce this purchase protection for the entire city as soon as possible, NOS reports.

At a price limit of 512,000 or less, six out of ten Amsterdam houses will be covered by this purchase protection - called the "live there yourself obligation" by the city. Anyone who buys such a house will not be allowed to rent it out for the first four years. 

"It is unacceptable that people looking for a home are trumped by investors who buy homes to rent them out at sky-high prices," said Amsterdam's housing alderman Jakob Wedemeijer (SP). "That is why we want to ensure that as many homes as possible can only be bought by people who will actually live there. Homes are for living in and not for making money."

A change to Dutch law allows municipalities to designate neighborhoods or districts for purchase protection from January 1. If these protected homes change hands, the new owner may not rent them out for the first four years. An exception is made if the home was already a rental for at least six months before its sale. Houses may also still be rented out to family members like children, grandchildren, or siblings. 

The amendment states that municipalities must "substantiate whether and in which neighborhoods imbalanced and unjust effects occur due to the scarcity of cheap and medium-priced owner-occupied homes". The municipalities must also show that the purchase protection is "necessary and effective" in the chosen neighborhoods.

Amsterdam previously announced that it was planning to implement the purchase protection scheme throughout the city. Other large cities, including Utrecht, Tilburg, The Hague, and Groningen, are also considering the idea.