One-off rent reduction cost millions but impact was marginal

The one-off rent reduction in 2023 cost housing associations millions, but had little effect. This is stated in an evaluation by the Ministry of Housing and Spatial Planning. The rent prices of homes went down, but this also led to the tenants receiving less rent allowance.

The rent was lowered to 575 euros a month for 595,000 people renting a home with a below average income. Their rent price dropped by an average of 56 euros. But they only kept 24 euros of this, because they also received 32 euros less in rent allowance.

The measure resulted in housing associations receiving 397 million euros less in rent. They can also loan 8.3 billion euros less as a result. The measure only counted for people who were renting from a housing association.

Despite the significant decrease in income, the housing associations still had enough funds to meet the agreements about home construction and sustainability, BinnenlandsBestuur reported.

The evaluation could not show whether the rent reduction resulted in a better flow of tenants. This will only be able to be assessed further down the line. A lower rent could also mean that tenants are less likely to move to a home that better suits their situation, which could also put pressure on that goal.