The number of new homes built in Amsterdam this year is likely to be no more than 4,500, well short of the 7,500 target, city housing chief Reinier van Dantzig said on Thursday.

Work has started on just 211 “affordable” rental and owner-occupied properties, even though this is the sector the city wants to focus on, council figures show.

Dantzig, who described the figures as “terrible”, said it is becoming increasing difficult for the commercial sector to build profitably because of rising costs and interest rates. “It is a tussle to get every home built,” he said.

The city is now planning to see what can be done to boost the number of conversions and to see if action can be taken on land prices, which developers have criticized for being too high.

The city also hopes to qualify for extra government cash to stimulate the house building programme.

However, the city administration has no plan to alter its current pledge to ensure 40% of all new homes are rent controlled and 40% have rents of up to €1,000 or can be bought by people on middle incomes.

The Netherlands has a current shortage of some 390,000 homes.

Housing minister Hugo de Jonge told developers and investors at the annual Provada real estate industry trade fair in June that they should start looking at the Netherlands’ housing crisis from the perspective of the people looking for homes.

“Everyone knows someone who is unable to find a place to live,” De Jonge said.

The real estate industry has been highly critical of some of the measures the minister has proposed to stimulate the development of more affordable housing, such as greater rent controls.