Largest rent increase in six years

© Hollandse Hoogte / Mariette Carstens
As of July 2020, housing rents went up by an average of 2.9 percent year-on-year. This is the largest increase since 2014, exceeding the average over the past ten years (2.7 percent). Rents rose by 2.5 percent on average in July last year. The larger increase this year is mainly due to higher inflation. More than 42 percent of all dwellings in the Netherlands are rental properties. This is reported by Statistics Netherlands (CBS) on the basis of newly released figures.

In July 2020, the rents of social housing owned by housing corporations increased by an average of 2.7 percent. Rents of social housing owned by other agencies went up by 3.4 percent while private sector rents went up by 3.0 percent.



Larger increase in rents of housing corporations

Almost 70 percent of all rented properties are owned by housing corporations. For social housing owned by housing corporations, the average rent increase as of 1 July this year is significantly higher than last year: 2.7 percent this year against 2.0 percent in 2019. This is mainly caused by the higher inflation rate. In over 30 percent of the cases, housing corporations raised the rents by the rate of inflation.
According to the rental policy, the total rental income of a corporation may only increase to a limited extent. The maximum increase for 2020 is 2.6 percent. This does not apply to rents charged under a new tenancy agreement, which means the average rent increase for corporations may be slightly higher this year.



Rents rise by 9.5 percent on average during tenant changes

This year, the rent increase during changes of tenancy was also higher than in 2019. The average increase during tenant changes stood at 9.5 percent this year. This was still 8.2 percent last year. Lessors are not bound to a maximum increase when a new tenant moves into their dwelling. For existing tenants, the average rent increase stood at 2.4 percent.

Largest rent increases in Rotterdam and The Hague

For the first time in years, the highest rent increase was not recorded in Amsterdam but in Rotterdam. Rents in Rotterdam rose by 4.1 percent against 3.5 percent in Amsterdam. Likewise, rents in The Hague have risen more steeply than in Amsterdam: by 3.6 percent. Rents in Utrecht rose less sharply than the national average, namely by 2.6 percent.

The relatively high increases in Rotterdam, Amsterdam and The Hague contributed to the provinces of Noord-Holland and Zuid-Holland seeing the highest rental growth rates. The province of Drenthe has had the lowest rental growth rate in the Netherlands for years. This year, however, it recorded the third highest increase after Noord- Holland and Zuid-Holland : 3.0 percent, as much as the province of Groningen.

Regional disparities are mainly caused by different rates of increase during tenant changes. The impact of the higher increase during tenant changes is 1.3 percentage points in Rotterdam, but 0.4 percentage point in the city of Utrecht.

Sources