Dutch housing shortage rises to 410,000 homes; Rental market particularly affected

The Netherlands currently has 410,000 fewer homes than households, up from a shortage of 400,000 last year, the Telegraaf reports from research by the consultancy firm Capital Value and ABF Research, which calculates the housing shortage for the Dutch government. They expect the shortage to continue to worsen, particularly in the rental market.

The Netherlands’ housing shortage now stands at 4.8 percent of the housing stock. Previous governments aimed to reduce the shortage to 2.1 percent by 2031. According to the researchers, under the current policy, the shortage will likely drop to 3.9 percent by then.

The biggest problem is that housing construction is lagging behind the growth in the number of households. Last year, only 69,200 new homes were completed in the Netherlands - far below previous governments’ target of 100,000 homes in 2025. A substantially higher number is expected this year, at approximately 88,000 homes. However, the number of issued building permits has fallen again, and Capital Value is doubtful that this higher production will continue.

Capital Value director Arjan Peerboom is positive about the upcoming Cabinet’s plans to accelerate the permit process for housing construction and address the endless objection procedures. “It’s a step forward, but not enough. More funding is also structurally needed for housing construction.”

Capital Value expects that the housing shortage will continue to worsen, especially in the rental market, as investors continue to sell off their rental properties into the owner-occupied market. Landlords have been ditching rental units since the government implemented rent regulation for mid-market rentals in July 2024. Various tax changes have also made it less lucrative to rent out homes.

Among housing associations, 56 percent expect to sell more of their units into the owner-occupied market than they’re currently doing. 33 percent expect to continue selling at the same pace, and only 11 percent expect a decrease. The proceeds are primarily intended to fund new housing construction.

These sales will further worsen the situation in the rental market, and the shrinking supply will lead to higher rents.