The private rental market in the Netherlands is facing significant challenges, with a sharp drop in supply driving up prices. Housing platform Pararius reported on Thursday that the number of
available rental homes decreased by 40.4% in the fourth quarter of 2024 compared to the same period in 2023. Meanwhile, the average rent per square meter rose by 7.7%.
In the final quarter of 2024, the average rent for private sector homes reached €1,730 per square meter—7.7% higher than a year earlier and over 20% more than in the first quarter of 2021, during the height of the coronavirus pandemic. To afford an average rental in the private sector, residents now need a monthly income of at least €5,200.
Plummeting supply and intensified demand
The supply of rental properties has dropped dramatically. In Q4 2024, only 12,274 private sector homes became available, compared to 20,589 in the same quarter of 2023—a reduction of more than 40%. Pararius noted that 12,979 properties have been withdrawn from the rental market, indicating they are no longer available for lease.
This decline in supply has intensified competition among tenants. Each rental listing received an average of 42 responses last quarter. The situation is even more dire in the mid-market segment—defined as rentals priced between €879.66 and €1,165.81 per month—where properties received an average of 84 responses in Q3 2024.
Policy challenges and market impact
Pararius attributes much of the supply shortage to the Affordable Rent Act, implemented in July 2024, which expanded rent regulations to include mid-market rentals. "The unprecedented number of responses to affordable private sector rental properties illustrates the heightened competition among tenants. The current climate underscores the urgency of revising government policy to alleviate pressure on the rental market swiftly," said Pararius director Jasper de Groot.
De Groot added that both private and institutional investors are eager to address the high demand but are constrained by rent regulations and strict affordability requirements. He urged the government to reconsider its policies, warning that the ongoing supply shortage has severe implications for population mobility and the broader housing market.
As the private rental sector grapples with these challenges, the call for swift and effective government intervention grows louder to stabilize the market and address the urgent housing needs of residents.