Housing rental prices on the free market are on the rise again
November 11th, 2021
Compared to a year ago, rental prices for housing are clearly surging. In The Netherlands, this market is divided into 2 sectors: social housing and the private sector. The split between these sectors is set at a monthly rent of 750 euro. Below is social, and above it’s private (or also called free market). In such cases, landlords are free to set their own rental price and determine annual rent increases, there is no maximum.
According to the housing platform Pararius, the period of rental price declines caused by COVID-19 is taking an end. This price drop from last year in the third quarter occurred for the first time in six years and that decline continued for a while. Last quarter, however, tenants paid an average of 2.5 percent more per square meter than a year ago. In the area Nieuw-West in Amsterdam, rents in the free sector rose the most, with 4.1 percent.
A stroke of luck, as you could call the temporary decline in rents in 2020. But now that the pandemic has subsided and expats are returning to The Netherlands, prices are on the rise again.
During the pandemic, vacant properties, especially those in the higher segment, were less easily rented out. Due to travel restrictions and the switch to working from home, far fewer expats and tourists came to The Netherlands. In order to prevent vacancies and still rent out homes to local house hunters, they were priced more attractively. "In the meantime, travel restrictions have largely been lifted, causing rents to rise again in popular expat cities like Amsterdam”, says Pararius director Jasper de Groot. As a consequence, the growth in tourism is causing the return of regular rental market to a short stay market.
The capital is still the most expensive city for renting. Rents in Amsterdam rose by 1.6 percent over the past quarter, meaning that tenants had to pay 22.44 euros per square meter per month (on average). Rents also rose in other large cities like Rotterdam, The Hague, Eindhoven and Utrecht. Of all these cities, Eindhoven was the cheapest city with 14.85 euros per month.
(Picture by Alexandr Podvalny , pexels.com)