Affordable housing law passes Dutch Senate vote; Rent protection will cover more tenants

The Affordable Rent Act passed a vote on Tuesday in the Eerste Kamer, the Dutch Senate. This law, meant to bring rent prices down in the middle and social housing sectors, will be implemented from Monday onwards, one day before the new Cabinet takes office. As expected, coalition party PVV supported the measure, but coalition members VVD and BBB did not.

The most discussed part of the law is the expansion of the points system, a method to assess a dwelling and determine the maximum rent a landlord can charge. This point count system will also be used for homes up to 186 points, which was about equal to a monthly rent of over 1,100 euros according to the most recent calculations from the beginning of June.

The points system for the mid-range market segment will only apply to new contracts. It will take some time before all rents in that sector have been limited

In addition, the points system will also be “compulsory.” This means that municipalities will be able to take action against overpriced rental properties, as opposed to the current situation where tenants have to contact their landlord to work out a deal, or the Rent Tribunal, when they have any complaints.

Landlords who set prices which are too high can be issued a warning or a fine.

Municipalities are not yet ready to implement the new rules, according to the Association for Dutch Municipalities (VNG). “Municipalities are already starting to prepare and this must be done carefully,” wrote the VNG when it asked the Senate to support a motion to give municipalities more time. The motion to grant municipalities a six-month extension was adopted unanimously.

“The date of July 1 must be set,” De Jonge said last week about the law as a whole, but he was also open to offering municipalities and landlords some more time. The minister also said he would consider October 1 as a possible date when municipalities can begin enforcement.

Landlords must provide a tally of points for new contract signings, the law further states. The idea is “that the tenant and landlord will first discuss” the rent, without immediately ending up in a legal conflict. The adopted motion also asked for a postponement regarding this point.

BBB politician Mona Keijzer is expected to take over De Jonge’s policy portfolio for the new Cabinet. She has largely supported the interests of real estate investors and developers, and strongly opposes the Affordable Rent Act. She previously indicated that the law means investors and landlords will not be able to profit on the rental market, and will instead sell off their rental properties.

This could further reduce the supply of rental housing when there is already a critical shortage of available homes. The BBB has also taken the side of real estate investors for a longer period. Party leader Caroline van der Plas argued that investors were being ignored. During an election in November she said she wants to see a reduction of housing market regulation over the next decade.