Amsterdam allows rent hike in mid-priced segment to stimulate housing construction

The city council of Amsterdam is allowing the rent of medium-priced rental properties to increase in order to restart the construction of those types of homes. The office of mayor and aldermen announced on Wednesday that it agreed to make use of the temporary 10 percent surcharge for newly built homes in the Affordable Rent Act. “This is desperately needed because the construction of these homes is lagging behind, and the demand is very high,” the office said.

According to alderman Reinier van Dantzig (Housing Construction), this is due to the increased costs and interest rates. “By aligning with the rental prices under the Affordable Rent Act, we offer more financial space to developers to build homes, and we facilitate developers to continue building in this affordable segment.”

The Senate passed the Affordable Rent Act just before the Cabinet changed. The law limits excessively high rental prices based on a points system. According to former Housing Minister Hugo de Jonge, the monthly rent of approximately 300,000 tenants will fall by 190 euros in the future.

At the same time, a temporary surcharge of 10 percent applies to the maximum rent price of mid-range rental properties to prevent new construction projects from being delayed or unable to proceed. As a result, higher rents may be charged for certain new buildings. This concerns projects that started construction before 1 January 2028.

“With the temporary transitional rule, the municipality offers to option of charging a maximum rent of 1,274 euros for newly built homes and an average rent per project of 1,175 euros,” Amsterdam reported. The office hopes that the temporary measure will lead to more homes in the mid-priced segment, which are “also very energy efficient.”