Building 100,000 homes per year only possible if gov't contributes billions

The government’s goal of building 100,000 new homes per year to combat the housing shortage will only work if the government contributes 3 to 5 billion euros in support every year until 2030. Housing corporations, construction interest groups, Dutch municipalities, the Dutch provinces, and interest groups for homeowners and tenants, among others, said that in a letter to the government, NOS reports.

The involved organizations have mutually agreed to do their utmost to build 100,000 new homes per year, and they stand by that. They also endorse the government’s desire for two-thirds of the new homes to fall into the “affordable housing” category. But that makes government support even more necessary because these types of homes generate less money.

“Without the right support from the government, it is impossible to deliver the desired housing production of the desired quality,” the organizations said. The up to 5 billion euros annually is needed to build the infrastructure for new residential areas, among other things. The municipalities and provinces have insufficient financial resources to cover that themselves.

They also propose several subsidies and tax cuts. They want the government to abolish the corporate tax municipalities currently pay on the profits they make from land development. “After all, municipalities do not have a profit motive but a social objective,” the organizations said. They also want to abolish the corporate tax for housing corporations and reduce the transfer tax for investors in rental properties.

Finally, the organizations want the government to subsidize project developers for construction projects that are not sufficiently profitable, particularly if this is due to the government’s requirement for affordable housing. The current subsidies from the Start Building Impulse and the Housing Construction Impulse from 2019 are incidental and insufficient, the organizations said.

The letter was signed by 12 organizations - Aedes (housing corporations), Bouwend Nederland (construction), WoningBouwersNL (housing construction), Neprom (project developers), VNG (the Association of Dutch Municipalities), G40 (medium-sized municipalities), IPO (provinces), IVBN (institutional housing investors), Vastgoed Belang (private landlords), NVM (realtors), VEH (homeowners), and Woonbond (tenants).

They pointed out that they’re also making agreements among themselves to build faster and cheaper. For example, they plan to make more use of industrial housing construction, where many homes are prefabricated. And the municipalities have agreed to standardize their requirements for new and affordable housing at a national level.