News item | 09-12-2022 | 3:30 pm
To protect tenants with a middle income against excesses and to ensure that they pay a fair price for their home, the cabinet wants to regulate the middle rent. By regulating the mid-rental segment and making the housing valuation system (WWS) mandatory, the rent of more than 300,000 homes will fall by an average of 190 euros. The regulation is designed on the basis of four principles: the protection of the tenant, sufficient supply of affordable homes, the willingness of landlords to invest and stimulating the sustainability of rented homes.
Minister De Jonge for Housing and Spatial Planning: “An affordable rental home is less and less self-evident for people with a middle income. Due to the enormous scarcity, the top price is demanded for homes that are really not worth it. While teachers, nurses and police officers are allowed to foot the bill. By regulating the mid-market rent, I want to better protect them against excesses, so that people pay a fair price for their home.”
Mid-rent regulation
Rent protection for middle incomes will be introduced by expanding and modernizing the existing WWS. This already exists for the social segment (for homes up to approximately 141 points) and with the expansion of the WWS this limit will be raised to 187 points, so that middle incomes also receive a regulated rent. 187 points currently corresponds to just over 1,000 euros. The price for this number of points is indexed annually with inflation and will amount to approximately 1,100 euros when the law comes into effect. The regulation will apply to new rental contracts and as long as there is a shortage on the housing market. The need for regulation is evaluated at various times.
Extra impulse for sustainability
The WWS also needs to be modernized in order to bring the system more into line with the quality of mid-market rental homes that are currently being built and to maintain the willingness of landlords to invest. For example, the energy efficiency of a home is better appreciated. Homes with energy label A or higher receive extra points, while energy label E or lower receive negative points. This increases the price difference between homes with a good and a bad energy label and stimulates the sustainability of rental homes. The valuation of the outdoor space will also be adjusted, so that a roof terrace of 20 square meters earns more points than a balcony of four square meters. Finally, the maximization of the WOZ value will apply from 187 points instead of the current 142 points, so that homes do not only end up in the free sector due to a high WOZ value.
New construction receives extra support
The starting point is that the regulation applies to both existing and new construction. It is important, however, that the regulation does not delay ongoing new construction projects. That is why a surcharge is being introduced for new-build homes still to be delivered, amounting to 5% of the maximum rent up to 10 years after completion. This applies to mid-market rental properties that are completed after 1 January 2024 and where construction has started before 1 January 2025.
Mandatory maximum price
In addition, the WWS will be made mandatory. As a result, landlords in the regulated segment are obliged to respect the maximum rents based on the WWS. If a landlord does not comply with this, this can be enforced. Landlords will soon risk a fine if they charge too high a rent for a home that should be a social or mid-rental rental based on the quality. The consequences for enforcement will be mapped out in the coming period.
More affordable housing
Due to the regulation of the middle segment, there will soon be more affordable rental homes. Housing associations, institutional investors and developers want to build 100,000 mid-market rental homes by 2030. Making the WWS mandatory also ensures that regulated homes are rented out for a price that matches the quality of the home. This improves the overall affordability of housing in the rental sector.