Free market home rental prices jump 12 percent in a year
Free market rents increased by an average of 11.8 percent per square meter in the second quarter of 2022, compared to the same quarter last year, realtors associations NVM and VGM NL reported on Monday. That is the biggest increase in free-market rents since the associations started tracking quarterly figures in 2014. On average, new tenants paid 15.35 euros per square meter per month in the second quarter, compared to 13.73 euros the year before.
Free market rents include properties with a basic rent of over 763 euros per month. The provinces with the highest square meter prices, Noord-Holland, Zuid-Holland, and Utrecht, saw the lowest price increases at less than 10 percent. Flevoland saw the biggest rent increase at 27.2 percent, followed by Groningen at 21.6 percent.
On the municipal level, the most significant rent increases happened in Amstelveen (+41.1 percent), Almere (+31.7 percent), and Groningen (+21.8 percent). Three of four large Dutch cities saw below-average rent increases, with Rotterdam even seeing a rent decrease (-6.1 percent). In Amsterdam, free-market rents increased by 5.1 percent, and in Utrecht, by 7.4 percent. The Hague's rent increase was equal to the national average. Haarlem was the only other municipality in which rents decreased (-5 percent).
"With these price increases, the rental market is becoming increasingly inaccessible," NVM chairman Onno Hoes said. "In both the rental and owner-occupied sectors, the accessibility of a home is getting further out of sight, and the tenant really falls between the cracks with this policy."
According to Hoes, the government's measures to keep investors out of the market, like purchase protection, and proposals to regulate the middle rental segment, are damaging the rental sector. "We have been arguing for a more nuanced package of measures for some time, in which the playing field between rent and purchase is leveled. Unfortunately, that message has not yet fully arrived at the central government, and the tenant is the victim."
After falling for four consecutive quarters, the number of rental transactions in the free market finally increased again quarterly. In the second quarter, there was 5.6 percent more registered transactions than in the first quarter.
Sander Groot, chairman of VGM NL, called it a good sign that more people are relocating again, but the flow in the rental market is still stagnating. "It would be good to create a good investment climate to create more supply in the rental sector," he said. "Municipalities, investors, and other parties involved in the market must work together to realize affordable new built homes.”
According to De Groot, a larger free rental sector promotes the flow in the market, among other benefits. “Despite the advantages of renting, the government is strongly committed to promoting home ownership, and investing in real estate for rental seems to be discouraged.”
The proportion of newly built homes in the free market was 25 percent in the second quarter, significantly higher than in previous quarters.
