Landlords continuing to sell off rental homes, especially in largest Dutch cities

Private landlords sold more homes in the past quarter than a year ago, according to figures from the Land Registry. They mainly sold to people who were going to live there themselves, turning the rental into an owner-occupied home. The majority of these sales happened in the four large Dutch cities. Institutional investors also sold homes, but their number of rental homes increased due to new construction.

The Land Registry investigated commercial landlords who own two or more properties. The figures don’t include housing corporations.

In the second quarter, commercial landlords collectively sold around 5,900 homes to owner-occupiers. They also bought around 1,100 homes from owner-occupiers to rent out. That means that this part of the rental sector shrank by around 4,800 homes. Most of these transactions (2,900 sales and 1,300 purchases) happened in the four large Dutch cities - Amsterdam, Rotterdam, Utrecht, and The Hague.

That is not a massive number compared to the Netherlands’ total of over 8 million homes. But the figures confirm predictions made in the runup to the Affordable Rent Act, which took effect on July 1. The law extended the points system that applies to social housing to part of the private sector. The rent for properties under 1,158 euros or 1,274 euros for new construction is now regulated based on what they offer in terms of size, insulation, and quality.

This particularly impacted smaller, private landlords in the big cities, where the housing shortage meant that smaller, poorer-quality homes were often rented for exorbitant prices. The expectation was that these landlords would sell their properties because they became unprofitable to rent out. The Land Registry’s figures show this is indeed happening and gaining steam.

“This will continue to happen gradually over the next two years, when the last temporary rental contracts expire, and private landlords can sell their property more easily,” Paul de Vries of the Land Registry told NOS.

Housing corporations and large institutional investors were less impacted by the Affordable Rent Act and most aren’t planning to sell their rentals.