What does the cabinet crisis mean for the housing market?
The political situation in the Netherlands is in flux. When PVV leader Geert Wilders pulled the plug on the cabinet, many questions arose about the consequences for the housing market. After 335 days, the Schoof cabinet is coming to an end. There is a strong chance that new elections will be held at the end of November. But what does this mean for the housing market? Below, we outline the main developments.
1. Rent freeze off the table
One of the first things to change is that the proposed rent freeze will not go ahead. The plan to temporarily freeze rents was rejected by many parties, including the opposition, the housing market itself, and even some within the coalition (except for the PVV). Minister Keijzer (BBB) had submitted the proposal, but the political situation changed when the PVV left the government. Now that Keijzer no longer depends on PVV support, she is not required to pursue the plan further.
This comes as a relief to Keijzer, as Aedes—the umbrella organisation for housing associations—had already announced legal action. Now that the rent freeze has been shelved, they no longer need to file a lawsuit.
2. Coordination act for public housing
With the rent freeze gone, there’s more room for other plans, such as the Coordination Act for Public Housing (Regiewet Volkshuisvesting). Originally introduced by former minister Hugo de Jonge (CDA), the law would require municipalities to ensure that 66% of new housing is affordable. But many municipalities found this target too difficult, so Keijzer modified the proposal. Now, targets will be set regionally instead of locally.
Without the rent freeze, housing associations are in a better position to keep investing, which benefits the construction of social housing. If this law is passed, municipalities will have more flexibility to determine how much social housing is needed, based on local demand.
3. National Performance Agreements
Last December, during the Housing Summit (Woontop), Keijzer and several stakeholders agreed to build 100,000 homes per year. This was a major step, though its feasibility was already questioned. While builders and municipalities supported the plan, some key investors—like pension funds—were missing.
The rent freeze would have made it more difficult to meet these targets. Now that it’s off the table, the national performance agreements remain important, though whether the goal of 100,000 new homes is realistic remains uncertain, especially in light of ongoing financial challenges.
4. Affordable Rent Act
Minister Keijzer wants to amend the Affordable Rent Act (Wet Betaalbare Huur). The law was only recently introduced, but Keijzer believes some adjustments are necessary. For example, she wants the property’s assessed value (WOZ) to carry more weight in the rent points system, especially in popular cities. This would allow rents in high-demand areas to rise slightly, without removing them from the regulated rental sector.
Keijzer hopes to present the proposal to parliament before the summer, but it’s uncertain whether it will gain enough support. The left-wing opposition is against it, while the VVD believes the proposal doesn’t go far enough. So we’ll have to wait and see what happens after the November elections.
5. Box 3 and taxes for investors
Another area affected by the cabinet crisis is Box 3, the tax on assets. In recent years, the notional return used for taxation was higher than the actual returns for many investors. This led to lawsuits, and the Supreme Court ruled that the government must provide compensation. State Secretary Van Oostenbruggen (NSC) has proposed raising the notional return to 7%, but due to the cabinet crisis, it will be up to the next government to implement this.
6. Nitrogen issue and housing construction
The nitrogen issue remains a major bottleneck for housing construction. According to Bouwend Nederland, nitrogen restrictions will prevent 244,000 homes from being built by 2030. This would cost the economy billions of euros. Although agriculture minister Femke Wiersma (BBB) has proposed a new plan, little will change for the housing sector. The nitrogen file is therefore being passed on to the next cabinet.
7. What now?
The cabinet crisis is definitely having an impact on the housing market. Scrapping the rent freeze has created space for other initiatives, such as the coordination act for public housing and the national performance agreements. The affordable rent act may also be amended, but it’s unclear whether it will pass through parliament. Meanwhile, the nitrogen issue continues to delay housing construction, creating additional challenges.
In short, the coming months will be crucial for the housing market. New elections could shift the political balance, which will affect the feasibility of various housing plans. Whether there will be real progress remains to be seen. What is certain, however, is that the housing market will continue to feel the effects of the cabinet crisis in the months to come.