Residential property rents were raised by an average of 4.7 percent in July 2013, the most substantial increase since 1994. Tenants in the highest income category living in dwellings owned by social housing corporations faced the highest increase.
Rent based on inflation and income
The maximum rent increase in 2013 was not only based on the inflation rate over 2012, but also on the income category of the occupants. The rent increase of 4.7 percent effective from 1 July 2013 is 2.2 percentage points higher than the inflation rate over the entire year 2012.
In the period 2001–2012, the rent increase was on average 0.3 percentage points above the level of inflation in the previous year. For the first time since 1996, the difference between the rent increase and the inflation rate over the preceding year is more than 2 percentage points.
Rent increase on 1 July and average annual inflation
Rent increase varies by market sector
Four in five dwellings are owned by organisations operating on a non-profit basis, e.g. housing corporations. The rent increase imposed by social housing corporations averaged 5.0 percent versus a 3.7 percent rent increase imposed by private landlords.
Liberalised rents were raised by 3.9 percent, non-liberalised rents by 4.7 percent. In liberalised contracts, rents are more often adjusted when new tenants move in. The effect of rent harmonisation on the rent increase is 0.8 percentage points this year.
Rent increase with and without harmonisation, 2013
Many tenants do not pay the maximum rent increase
In 2013, the maximum rent increase allowed for dwellings below the liberalisation limit is most often imposed by social housing corporations: 66 percent of these dwellings accommodate low-income households. For 80 percent of low-income tenants, the rent increase equalled the maximum rent increase of 4 percent. In the category mid-level incomes, 47 percent had to pay the maximum rent increase of 4.5 percent. In the highest income category, 53 percent had to pay the maximum rent increase of 6.5 percent.
Occasionally, the rent increase exceeded these percentages. In most of these cases, the rent increase was based on the rent harmonisation system. For approximately half of mid and high-level incomes, the rent increase was below the maximum.
Rent increase social housing corporations, 2013
In dwellings below the liberalisation limit owned by private landlords, the maximum rent increase is less often imposed. Approximately 30 percent of high-income tenants living in dwellings owned by private landlords faced a rent increase of 6.5 percent. Likewise, only 24 percent of mid-level income tenants had to pay the maximum rent increase of 4.5 percent.