Niki Struving, a 21-year-old student in Amsterdam, sits under an umbrella next to a circus tent, in bitter winds and driving rain. She is braving icy weather to campaign for more affordable housing – a key topic in Dutch regional elections this week.
For a country known for its fiscal prudence, the Netherlands is suffering a surprising housing crisis. “In a couple of years I won’t be a student any more, but where will I go?” says Struving. “Back to my parents? I have a student debt of €30,000, so how would I buy?”
Years of government policy have stimulated home ownership and left building to the market, creating a situation where many are priced out and cannot find an affordable house to buy, or to rent. Dozens of people demonstrated last week in The Hague and presented a petition with 102,621 signatures calling for affordable housing to Hugo de Jonge, the housing minister.
The average home costs €424,681, more than 10 times the modal income. From 2015 to 2021, average household disposable income increased by 25%, but house prices rocketed by 63%, fuelled by low interest and a national shortage of 390,000 homes. By the peak of its housing boom last year, houses in hotspots had increased by more than 130% since the end of 2013.
But cold winds are blowing in a country judged by the Economist to be one of the developed markets most vulnerable to a housing crash. The most up-to-date indicators suggest house prices have dropped year-on-year by 6%, and the central bank De Nederlandsche Bank (DNB), Rabobank and the IMF predict falls to come, but not enough to correct the recent, extreme price rises. The government aims to build 900,000 homes by 2030, but the high price of raw materials, increased borrowing costs and nitrogen pollution from building work are already a challenge.
Almost 60% of the 8m Dutch homes are owner occupied, while there are 2.6 million rent-controlled social homes, with a maximum rent of less than €800 a month. But in the liberalised sector, rents have spiralled in the big cities and – unlike for social housing or owner occupied homes – there is no government help. The Dutch economist Mathijs Bouman says that although the housing market has previously seen “hysterical” fluctuations, things got out of hand during the pandemic when mortgages dropped to about 1% as central banks lowered interest to stimulate the economy.
“The housing crisis is extremely serious and has worsened in recent years,” says Dr Cody Hochstenbach, an urban geographer at the University of Amsterdam who has written a book on the problems. “The number of homeless people has doubled, a quarter of renters struggle to pay their bills, class differences have become much more acute and young people are having a tough time, especially those with a low income, without wealthy parents, with difficult backgrounds,” he says.
Insufficient housebuilding in the past decade is the obvious cause. Other causes, some believe, are the free-market direction of government, the sale of social housing, the scrapping of a national housing ministry, beneficial schemes for investors, and Europe’s most generous mortgage interest tax relief (leading to one of the world’s highest mortgage debts).
“In the last 30 years, there has been a consistent set of politics based on the ideology of home ownership, encouraging us all to buy as strategic, calculating mini-capitalists,” says Hochstenbach. “People are encouraged, hounded even, to borrow as much as they can. The result is to drive up prices and increase the risks, locking people in homes if prices fall because they cannot sell without leaving a debt.
“The Netherlands had a rich tradition of social housing, it was an international example of affordable housing managed by housing corporations. But especially in the last decade, politicians have decimated housing corporations.”
Government proposals to regulate rent for more of the Netherlands’ housing stock – the “middle market” – could even have a counter-productive effect, estate agents believe, encouraging investors to sell up, further inflating non-social rentals and making housebuilding uneconomic. Developers say that regulation – from energy efficiency targets to nitrogen pollution limits – is blocking construction. “The economy will take massive hits due to all these ideological policies which have never been proven to be effective in the creation of better homes for the people who want to live in them,” said Anton Hosman.
Housing is key in this week’s provincial elections, says Sjoerd van Heck, an opinion pollster at Ipsos. He notes that rightwing parties are referring to it in the context of immigration, while on the left it is linked with the agricultural sector reducing its nitrogen emissions in order to free up more capacity for building. “It’s an interesting dilemma for the Farmer-Citizen party, which is doing well in the polls,” he adds. “You never hear them talking about homes, because they would have to do something about the nitrogen.”
For the PvdA labour party – polling as the largest senate party in a pact with the Green Left – it’s time to change the tone of Dutch housing. “The real issue is whether you look at housing as a market or as public housing supply, with housing as a constitutional right,” says Henk Nijboer, Labour MP and housing spokesperson. “When I started as an MP, a million houses were ‘under water’, with higher mortgages than their value. That’s a big risk again. Meanwhile, there are hundreds of thousands with a constitutional right to housing, who do not have it because the government has left too much to the market.”
But will the interests of wealthier homeowners be so easily outvoted? When 25-year-old house hunter Frederieke told housing minister De Jonge at the protest that, despite a good salary and savings, she could not find something to buy on her own, his reply was telling: “Have you thought about getting a rich boyfriend?”
