Dutch housing minister Elanor Boekholt-O'Sullivan has outlined several changes to current affordable housing legislation that she hopes will encourage more private landlords to offer rental properties in the Netherlands and boost housing supply by 100,000 units a year.

Housing minister Elanor Boekholt-O'Sullivan wants to attract international investors to the Dutch residential sector. Photo: Martin Beekman RVD

"A mature mid-market sector is essential for a healthy housing market," the minister told MPs in a series of briefings and reports. "To ensure sufficient supply, it needs to be attractive enough to invest in, and that is often not the case at the moment."

A number of measures to encourage institutional and international investors are also under consideration, the minister said. These include introducing a corporate tax exemption for foreign pension funds, which is now being examined by the Dutch tax authority, and further research to determine whether a guarantee scheme could attract more real estate investors.

Cutting red tape

She has also pledged to continue her predecessor's efforts to cut red tape and speed up the construction process, a plan that involves setting up specialist teams of expert civil servants who can be deployed when permit procedures threaten to cause delays.

Innovation, digitalisation and standardisation could cut the lead time for the design and permit process for new residential developments from eight to four years, the ministry said. In addition, Boekholt-O'Sullivan wants to invest €90 million in encouraging the development of prefab homes, and says half of all new construction should be prefab by 2030.

In terms of more immediate measures, the minister said she wants to encourage private investors to put money into affordable housing in the major cities. For example, she plans to extend the period during which investors can charge a 10% supplement on new properties from 20 to 24 years. This will give landlords more time to recoup their initial investment costs, she said.

Higher rents

Boekholt-O'Sullivan also plans to reform the points system used to assess maximum rents so that property values are better reflected, by allowing landlords in sought-after parts of major cities to charge more, and to scrap the points deduction for properties without a balcony or garden.

The minister is also reinstating temporary contracts for all students to encourage the development of more student housing. Institutional and private investors currently provide 50% of student housing in the Netherlands, where there is a significant shortage of supply.

The minister said she hoped all four of these measures would come into effect in January 2027.

Urgency remains

Dutch developers' organisation NEPROM has welcomed the minister's plans, saying they "show that the cabinet recognises the urgency of the housing shortage and is prepared to take action on several fronts".

"Scaling up and standardisation in the construction process can speed up production and make the sector less reliant on scarce labour," NEPROM said. Measures such as reducing property transfer tax could also help restore investor confidence, it said.

Call for consistency

"At the same time, the success of these plans will stand or fall on consistent direction and implementation," NEPROM said. "Strengthening the national government's coordinating role and shortening procedures are important preconditions for actually gaining momentum. It is essential that new measures do not lead to additional rules, but rather to simplification and predictability for the private sector."

The new government stated upon taking office that it wants to stimulate housing development and improve the investment climate, and is cutting the property transfer tax for investors from 8% to 7%.