Biggest rent increase in 30 years; Social housing rents rose most

July saw the biggest rent increase in 30 years, according to Statistics Netherlands (CBS). Rents were, on average, 5.4 percent higher than in July 2023. Such a big increase last occurred in 1993 when rents rose by the same percentage.

According to CBS, rents for social housing rose the most. Housing corporations asked for 5.6 percent higher rents, and other social housing landlords asked for 5.7 percent more. That is almost as much as the maximum increase set by the government.

On July 1, landlords in the social sector were allowed to increase rents by up to 5.8 percent. In recent years, the government limited rent increases to protect low-income households’ purchasing power in various crises. “Before this, rent increases were often on the low side due to the high inflation, energy prices, and the coronavirus period, so that low incomes had higher purchasing power. This year is different,” said CBS chief economist Peter Hein van Mulligen. According to him, rents may now be catching up.

In the private sector, rents rose by 5 percent. Here, rent increases have been limited to 5.5 percent since January. In recent years, tenants in the private sector faced the largest rent increases. In July, the Affordable Rent Act took effect and regulated the rents for homes in the middle segment.

Rents rose the most in the municipality of Rotterdam, CBS reported. Here, residents had to pay 5.9 percent more rent. According to Van Mulligen, the effect of tenants moving houses was relatively large in this municipality. Amsterdam saw the lowest increase of the four large municipalities at 5.2 percent.

Looking at the provinces, residents of Drenthe faced the largest increase at 5.8 percent. The smallest rent increase was in Groningen at 5 percent.

There has been a lot of talk about rent increases lately. Many tenants went to court because they thought their rents were too high. In several cases, judges ruled in their favor. The association of real estate investors IVBN said in May that it feared that landlords would have to pay back billions of euros in rent as a result.

In July, an important advisory report to the Supreme Court concerning two lawsuits about rent arrears stated that landlords in the private sector should be allowed to increase rent by a maximum of 3 percent above inflation.