Private sector rent hikes outpace inflation as landlord sell-off continues; Up 5% in Q2

Rents in the private sector increased again in the second quarter, as landlords continued to sell off their rentals, according to the housing platforms Huurwoningen.nl and Pararius. New tenants particularly had to pay more for apartments.

On average, tenants paid €20.94 per square meter, about 5 percent more than in the second quarter of last year. Rents therefore rose faster than inflation and owner-occupied home prices.

However, rents were slightly lower than in the first three months of this year. This was the first quarterly decline in over two years.

In the second quarter, new tenants paid an average of €1,882 per month, about 3 percent more than last year. Because landlords typically require a gross monthly income of at least three times the rent, tenants need an income of approximately €5,650 per month to rent an average private sector home.

The tightness in the rental market persists. Last quarter, 11,389 homes became available in the private sector, and 12,150 disappeared from the market because they were rented out or sold into the owner-occupied market. As a result, home seekers had a net total of 761 fewer homes to choose from.

In recent years, real estate investors have sold many of their rental properties. Changes in legislation made it less profitable to rent them out. Initially, this mainly concerned mid-market rental homes. According to Pararius, the sale of vacant rental homes is now increasingly shifting toward the higher-priced sector.

The influx of properties in the owner-occupied market is pressuring home prices, but due to the housing shortage, they are still rising. On Thursday, the realtors association NVM reported that home prices increased by 2.4 percent year-on-year to a record €506,000.