Private sector shrinking as landlords sell off rentals

On January 1 of this year, there were 3,000 fewer rental properties in the private sector than a year earlier. This is largely because of private landlords selling their rental properties into the owner-occupied market, Statistics Netherlands (CBS) reported on Monday.

At the start of this year, private landlords owned 22,000 fewer rental properties than a year earlier. In the same period, the number of properties owned by businesses and other organizations increased by 19,000, mostly through new construction, renovations, and divisions. That resulted in a net decrease of 3,000 private sector rentals to 1.18 million homes. In the previous three years, the number of private sector rentals increased.

Many individual landlords sold off their smaller, cheaper rental properties because changes to Dutch laws and taxes made renting them out less profitable. The Affordable Rent Act, which regulates rents for mid-level rental properties based on the points system that also applies to social housing, was implemented last year. In practice, this lowered rental income for many landlords. An increase in transfer tax, purchase protection in several large municipalities, and changes to the box 3 taxes also impacted landlords’ income.

Most of these rental properties were sold into the owner-occupied market. The provinces of Utrecht and Noord-Holland had the highest proportion of private rental properties transitioning to owner-occupied homes at over 5 percent. Zeeland and Limburg had the lowest share at over 2 percent.

Of the four large cities, Utrecht had the highest share of private rentals switching to owner-occupied properties at 6 percent, followed by Amsterdam (5 percent), The Hague (4.8 percent), and Rotterdam (3.9 percent).

The new regulations impacted large landlords with many properties less and there was no big sell-off of rental properties owned by companies. The number of rental properties owned by companies increased by 12,000 in 2024 to 419,000. The number of properties owned by foundations and associations increased by 7,000 to 235,000.

Landlord organization Vastgoed Belang called the decrease in private sector rentals a “worrying development,” speaking to ANP. “Despite the enormous housing shortage and the national target of building 100,000 homes annually,” the government “adopted a policy that keeps private landlords out of the market,” the organization said.

Caretaker Housing Minister Mona Keijzer (BBB) recently proposed relaxing the Affordable Rent Act, but a parliamentary majority rejected her plans.