Home rental price increase rising at fastest rate in eight years

In July, rents in the Netherlands were on average 3 percent higher than the same month last year. According to Statistics Netherlands (CBS), that is the largest annual increase since 2014.

The stats office examined both the prices of social housing and those in the private sector. Rents in the latter category rose 3.8 percent. Residents of social housing paid an average of 2.6 percent more. The figures concern the rental price development with and without a change of residents. The landlord may increase the rent when a house gets a new tenant. That is why the average rent increase is higher if the figures include change of residents.

Rents in Amsterdam rose the most out of the four large municipalities. Including resident turnover, rents in the capital rose by an average of 3.6 percent. The city of Utrecht came in second with 3.5 percent. Of the provinces, the rents increased the fastest in Noord-Holland (3.4 percent) and slowest in Drenthe and Friesland at 2.5 percent.

The government adjusted the rental policy on July 1 of this year. Unlike in 2021, social housing rents could also increase. That happened according to a fixed amount based on the tenant’s income. For private sector homes, this year’s rent increase was limited to the average inflation from December 2020 to November 2021, plus 1 percentage point. That means that rents for sitting residents could increase by up to 3.3 percent. The effect of the current high inflation will, therefore, only be visible in next year’s increases.

The tenant association, Woonbond, is concerned about the high rent increase this year. “That is worrying since the higher rent is accompanied by a higher energy bill. Housing is therefore quickly becoming more expensive for tenants,” according to the interest group.

The Woonbond pointed out that Housing Minister Hugo de Jonge previously announced that over 500,000 renting households with a low income and high rent would get a rent reduction in 2024. That is not fast enough, the association said. Woonbond wants rents to go down next year already and the rent allowance to rise. “Everything must be done to ensure tenants with a tight budget don’t drown,” said Woonbond director Zeno Winkels. He thinks the rent reduction should also apply in the commercial sector.

The interest group believes the Cabinet should take additional measures to prevent tenants from paying high rents for poorly insulated homes. For example, the Woonbond wants single glazing to be seen as a defect from now on. “This ensures that the replacement of single glazing falls under the maintenance obligation of the landlord. Tenants can then enforce this. If the landlord refuses, it means a rent reduction until the inefficient windows are replaced,” said the Woonbond.