Netherlands' private rental sector continues to shrink; Average rent up 17%

Competition among home seekers in the private rental sector increased significantly in the second quarter of this year as supply continued to fall, Pararius reports. On average, each advertised home received 57 applications, the highest number since the housing platform began tracking the figure in 2021. The average rent for new tenants increased by 17 percent to €1,830 per month.

In the second quarter of last year, properties received an average of 41 applications. Competition increased most among the cheapest private rental properties, with rents between €1,185 and €1,500 per month, according to the platform. Over 35 percent of applications went to these properties, while 27 percent of the listings fell in this price range.

Pararius noticed that the shortage is now also felt in the mid-priced segment (€1,500 to €2,000 per month), and that people are now increasingly looking at even more expensive properties.

Last quarter, over 2,100 rentals shifted to the owner-occupied market. According to Pararius, this is the highest number it started tracking this figure, and over 42 percent more than a year earlier. Landlords are selling properties more often after tenants move out, as legislation has made home rentals less profitable. A total of 12,744 private sector rentals became available in the past three months, over 36 percent fewer than a year earlier.

Demand for private sector rentals and prices have also risen further due to the tighter supply. The average rent for new tenants in April, May, and June was €1,830 per month, an increase of over 17 percent. Because landlords often require a monthly income of at least three times the rent, tenants must earn around €5,490 gross per month to afford the average rent, according to Pararius. The price per square meter has increased by almost 8 percent to an average of €20.06.

Rents rose in all five large Dutch cities, but the strongest increases were recorded in smaller and medium-sized cities outside the Randstad, according to the housing platform. The price per square meter in Roermond rose by over 28 percent to €16.80, and in Hoorn by more than a quarter to €20.70. In Hoofddorp and Zwolle, prices fell by over 7 percent.