Judith Norbart: Affordable owner-occupied versus rental homes? Don't choose, combine!
Municipalities are increasingly opting for affordable owner-occupied homes rather than mid-range rentals in new construction projects. This is not a structural policy choice, but rather a stopgap measure: regulation and tax measures are making it increasingly difficult to finance new construction projects with two-thirds affordable homes. But is this development desirable?
By Judith Norbart, Director, IVBN
Affordable home ownership sounds logical. After all, everyone needs a place to live. But not everyone can or wants to buy a home. First-time buyers on the housing market have to contribute a significant amount of their own money: for a home costing €405,000, for example, a personal contribution of €91,000 is quickly required. For a large group of middle-income earners, this is simply not feasible.
Furthermore, not everyone wants to own their own home. First-time buyers, people on temporary contracts, divorced households and expats need flexibility. For them, renting is not only a logical choice, but often the only option. Mid-range rental is not just an alternative to buying, but an essential form of housing.
Mid-range rental is not the problem, but the solution
In the Netherlands, there has always been a strong emphasis on home ownership and social housing. The mid-range segment of the rental market in the Netherlands is small. If municipalities opt for affordable owner-occupied housing to make projects financially viable, mid-range rentals will come under even more pressure. This reinforces a development that is already causing concern: the housing market is becoming unbalanced, while demand for mid-range rentals is high and growing.
The situation is all the more worrying because the supply of mid-range rentals is also under pressure in other ways. In the four largest cities – and increasingly elsewhere – the rate of sell-offs is now higher than that of new construction, which threatens to further reduce supply. Less investment in the mid-rental segment leads to fewer affordable options for middle-income earners and blocks the flow from the social rental sector. This undermines the functioning of the housing market as a whole.
Restore the investment climate, restore the balance
The reality is simple: as long as investment in mid-range rentals is held back, municipalities will continue to look for alternatives. Affordable owner-occupied housing may seem like a solution, but it is only a temporary fix that does not solve the underlying problems. In the long term, it will lead to less choice, less mobility and a further drying up of the rental market.
A healthy housing market requires balance. Investors are keen to continue investing in mid-range rentals, but they need a stable and stimulating investment climate to do so. If institutional investors cannot achieve an adequate return, they will disappear from the market – and with them the much-needed supply of mid-range rental homes. Local authorities and central government must therefore look not only at the feasibility of projects in the short term, but above all at the broader housing needs in the long term. The solution is not affordable owner-occupied or mid-range rental housing, but a healthy combination of both. This requires realistic conditions for investors, stable and stimulating policy and a vision that extends beyond the next few years.
We are not building for three years, but for generations. If mid-range rentals continue to disappear, freedom of choice will diminish, mobility will stagnate and the housing crisis will worsen. The solution is not a temporary shift, but a structurally healthy balance between renting and buying.
