Destination Services — Netherlands new legislation for the rental sector
New legislation, referred to as the ‘law good landlord-ship,’ has recently been instated in the Netherlands, with the purpose of safeguarding tenants and restructuring the rental property sector. This law, which came into effect on July 1st, endeavours to tackle various challenges tenants face within the rental market while ensuring equitable and unbiased treatment for all renters. By implementing this legislation, the Dutch government aims to foster a transparent and just environment for tenants and landlords.
Notably, one prominent feature of this new law is the requirement for landlords or their representatives to adhere to a clear and transparent tenant selection procedure. This procedure eliminates potential biases or discriminatory practices within the tenant selection process. Landlords are now obligated to justify their selection of tenants, ensuring that decisions are grounded in fair and non-discriminatory criteria.
Furthermore, the legislation includes provisions aimed at effectively combating housing discrimination. Given that housing discrimination is a pervasive issue, this law seeks to address it by introducing measures that promote equal access to rental properties for individuals regardless of their background or characteristics.
Another aspect of the law addresses the problem of excessive security deposits by capping them at a maximum of two months’ worth of rent. Additionally, the security deposit must not include service costs, thus providing further protection for tenants against excessive financial burdens.
To ensure that tenants are well-informed about their rights, the law mandates landlords or their representatives to provide written information regarding tenant rights. Additionally, details of local or municipal helpdesks must be made readily available to tenants, facilitating access to necessary assistance.
A crucial component of the law involves the regulation of rental increases. Going forward, rental increases will be subject to a maximum percentage, determined by the average salary raise, with an additional 0%, 0.5%, or 1% based on whether the property falls under the low, mid, or high (free) rental segments.
Currently, the Dutch rental market comprises social housing and the liberal market. Social housing is limited to properties with up to 136 points, with rent capped based on the assigned points. However, properties exceeding 136 points fall within the liberal market, allowing landlords to set rental prices in accordance with market rates.
Beginning January 1st, 2024, an amendment to the law is expected to be introduced, encompassing mid-segment properties up to 187 points. This amendment will result in rental amounts for such properties being restricted based on the point system, potentially leading to significantly lower rents compared to prevailing market rates. Consequently, some landlords may consider selling their properties rather than keeping them in the rental market. Properties valued at 187 points or more will continue to operate within the liberal market, enabling landlords to determine rental prices based on market demand.
The point system is pivotal in determining the maximum rental price for properties across the Netherlands. It considers various factors such as property size, energy label, and available facilities, assigning each element a specific number of points. The overall number of points then determines the maximum rent that can be charged for a property. For instance, a property with 100 points would have a maximum rent of €1,000 per month. However, landlords must seek an exemption from the point system if they wish to charge higher rent.
The introduction of this new law, along with potential future amendments, showcases the Dutch government’s commitment to overhauling the rental market in order to ensure equitable treatment of tenants and establish a more balanced housing environment. By implementing measures to combat discrimination, regulate rental increases, and provide transparent procedures, the Netherlands aims to cultivate a rental market that is fair, inclusive, and accessible to all.
If you have any inquiries, please don’t hesitate to contact:
Fruzsina Hodson
fruzsina.hodson@staging.santaferelo.com
DSP Group Support Manager
Santa Fe Relocation
Fleur Apol
fleur.apol@staging.santaferelo.com
DSP Team Lead, Netherlands & Belgium
Santa Fe Relocation
