The cabinet has agreed to water down its proposals to kickstart the housing market in return for support from three opposition parties.

The changes are needed to ensure the government has majority support for the plans in the upper house of parliament.

MPs from the D66 Liberals and two minor Christian parties ChristenUnie and the SGP still have to vote on the changes, agreed by party leaders in talks with housing minister Stef Blok on Tuesday night. Earlier efforts to reach a deal with the Christian Democrats collapsed.

Rents

The changes affect proposals to put up social housing sector rents, toughen mortgage rules and charge housing corporations an extra €2bn in taxes.

‘It is an agreement which will give an impulse to the construction sector and ensure people move up the housing ladder, in both the rental and owner-occupier sectors,’ Blok told reporters. He is due to announce the details later on Wednesday morning.

But sources told Nos television the maximum rental increase may be cut from 9% to 6.5% and that the extra tax on housing corporations may be lowered.

Plans to restrict the tax break on mortgage interest to repayment mortgages may also be changed to allow hybrid mortgages with a 50% repayment element to qualify.

In addition, sources suggest that value-added tax (btw) on housing maintenance and renovations may be reduced from 21% to 6% to boost the building sector.