Teodora and her boyfriend George were full of excitement when he was accepted on to a masters course at the University of Amsterdam. But the couple’s dream move became a financial nightmare after they started house-hunting.
Relying on her €25,000 salary and parental support, the pair from Romania ended up paying €1,850 a month for a rundown one-bedroom, 30 sq metre flat located in the attic of a former public housing block.
“There was a broken microwave, no room for an oven and a broken bed. I had to lay new flooring and repaint the walls myself,” said graphic designer Teodora, who did not want her surname published to reduce the likelihood of retribution from her landlord.
“We could only heat the bedroom if we turned off the heating in all the other rooms. But we took it because there was nothing else [we could afford].”
Such tales are common in the Dutch capital, where private landlords have been raising rents and even selling up in response to rising interest rates and higher taxes, while government regulations are set to further limit the properties allowed to be rented to those not able to obtain social housing.
Average rents rose 7.6 per cent between April and July, hitting €26.55 per square metre, according to data from property rental website Pararius.com.
“It’s insane,” said Chantal Stuurman, who runs The Rental Agency in Amsterdam. “Prices have never been as high as Paris and London, but I think we are at a tipping point. A three bed that would have gone for €2,750 a month last year is now €4,000.”
Stuurman partly blames the Netherlands’ two-tier housing system, which was introduced last year. Properties are classified by size and amenities and if the score is below a certain level the homes are restricted to social tenants — those earning less than €44,035 annually or €48,625 for a couple.
Social rent is capped at a maximum of €808 a month. “If your rental income [as a landlord] has gone from €2,000 to €800 you will be losing money. Once the tenant leaves, you sell,” said Stuurman.
Pararius.com calculated that compared with last year there was a fifth fewer unregulated properties available in Amsterdam in the second quarter of 2023.
Jasper de Groot, Pararius’ chief executive, said the story was the same across the Netherlands. “The national market share of unregulated rental properties at only 8 per cent is in stark contrast to the share of social housing at 32 per cent. As a result, the rental prices of the remaining properties in the unregulated rental market have significantly increased.”
Housing minister Hugo de Jonge plans to lower the threshold of what qualifies as social housing next year. This move would transfer a further 327,500 unregulated rental properties — about half of the total current number — into the social rental segment nationwide, according to property consultant CBRE.
The Dutch government also increased taxes on landlords this year. As interest rates have risen and mortgages become more expensive, this has been another factor prompting many to sell up, reducing supply further, said Stuurman. “The politicians think landlords are rich people exploiting the poor, but that is not the case,” she added.
The post-Brexit influx of white-collar workers has also contributed to driving private rents to new highs. Many multinationals have established their European headquarters in Amsterdam and since the UK’s departure from the EU there has been an inflow of executives from London.
Competition for places in Amsterdam is so intense that people are prepared to pay to get alerts the moment a new property becomes available. RentSlam charges €30 a month to message customers within 30 seconds of a property that would suit them being advertised.
Peter de Vreede, RentSlam’s chief executive, said: “The market is so out of balance that you have about three minutes to respond to a property going online. There are 50 to 200 people responding and the agent is going to stop answering after the first 10 to 15.”
De Vreede owns a place he rents out and said he could earn more by putting it on Airbnb, which is limited to 30 days a year in Amsterdam, than letting it long-term. Other landlords were choosing to make such a move, he said, adding that the only solution was to build more houses.
The Netherlands’ housing shortage has increased from 315,000 homes in 2022 to 390,000 this year, according to ABF Research’s annual forecast for the government. De Jonge wants to build 900,000 homes by 2030, but ABF predicts that only 834,000 will be possible. To properly address the shortage, the country needs 981,000 new homes by 2030, the researchers said.
Available land is scarce and expensive around Amsterdam and the rising costs of building materials and labour has led commercial developers to freeze plans.
Social housing corporations in the capital have begun building again, but say they need to sell off some stock to finance new homes and intend to upgrade 1,200 homes so they fall outside the social rent category. The city is also encouraging elderly people to move from family-sized homes into smaller apartments or retirement homes.
Woon, a government-backed tenants’ rights organisation, said the influx of expats and big institutional landlords upgrading former social housing stock was pricing out longstanding residents and changing the fabric of the city.
“Locals cannot afford Amsterdam. You get people moving from place to place and you cannot build a community. What is good for landlords is not always good for a city,” said Woon adviser Gert Jan Bakker.
Teodora and George decided to go to a rent tribunal as the final straw after their landlord refused to pay to repair a leaky boiler. The tribunal cut their monthly rent to just €561 and said nearly €10,000 should be returned to them in overpayments because the apartment was deemed to fall below the quality required for free market rental rates.
Despite the initial hassle, the couple is staying put for now. They say they are still waiting to get their money back and are not ready to rejoin the thousands chasing a new property. “We have invested in this place,” said Teodora. “We don’t want to move again.”
Extreme renting
This bonus article requested by FT readers is the final instalment of the series
