Amsterdam's partial ban on buy-to-let taking effect on 1 April
Amsterdam is implementing purchase protection on existing homes worth 512,000 euros or less from April 1. This means that people who buy these homes must live in them themselves and can't rent them out for four years. "Homes are meant to live in, not to earn money with," the city of Amsterdam said in a press release.
The city hopes that the purchase protection will give first-time buyers and people with a mid-level income a better chance on the housing market. A third of Amsterdam's homes are already in the hands of private investors. On Tuesday, the city reported that it now has more expensive free-market rentals than owner-occupied homes.
The buy-to-let trend is pushing home prices in the Dutch capital. The cost of an owner-occupied home has more than doubled in 7 years, to an average of around 600,000 euros. And new tenants in the free sector already pay an average rent of 1,466 euros per month.
According to the municipality, the price limit of 512,000 euros protects 60 percent of existing owner-occupied homes from falling into investors' hands. The purchase protection applies to the entire city. "Research shows that investors are active all over the city. There is scarcity and rising prices everywhere."
The city council still has to approve the purchase protection plan on February 16.
The purchase protection is made possible by a new law that took effect on January 1. About 130 Dutch municipalities plan to use this law, including Rotterdam and Utrecht. The city of The Hague was also considering it.
