Dutch municipality buys up land to help new homeowners afford a house
The municipality of Westland set up a housing fund to help locals afford a house. "We use the fund to buy the land on which the house is located," Remmert Keizer, party chairman of Gemeentebelang Westland, said to Omroep West. "That is about a third of the asking price of a house. In the case of a house of 300,000 euros, we, therefore, finance 100,000."
The municipality set aside 20 million euros for this fund, the construction of which resembles the ground lease. "Only this is much cheaper for the buyer," Keizer said. The buyers won't get the land for free. The municipality is still working out the details, but buyers will likely pay a small interest rate of 1.3 percent on the land.
"An average terraced house in Westland now costs between 350,000 and 450,000 euros," city councilor Andre van den Berg of Gemeentebelang Westland said to the broadcaster. "A couple with an average income cannot afford that. Thanks to the housing fund, we can now offer them a home."
The land will belong to the municipality as long as the buyer lives in the house unless the homeowner decides to buy it over. "If that doesn't happen and the house is eventually sold again, a third of the sale price will flow back to the municipality," Van den Berg explained.
Peter Boelhouwer, professor of housing at TU Delft, sees what the municipality is trying to do but worries that this fund will only push prices further. "Of course, that always applies to these kinds of measures, which is why you should always be careful with such plans in tight housing markets," he said to the broadcaster. "But if the municipality really intends this measure for its own starters, then the local youth will really benefit from it."