The decision to freeze social housing rents for two years must not prevent housing corporations from investing in new homes, two of the four coalition parties said on Tuesday.

Housing corporations have warned the freeze will significantly impact their ability to build, despite the coalition’s pledge of €1.1 billion in compensation.

Housing minister Mona Keijzer was not involved in last week’s negotiations on the government’s spending plans but must now assess how the rent freeze will affect her commitment to build 100,000 new homes annually — around 30% of which are intended to be social housing.

NSC leader Nicolien van Vroonhoven said housing corporations, which are responsible for most of the Netherlands’ social housing stock, “must not come under pressure” as a result of the decision.

VVD leader Dilan Yesilgöz said the corporations must provide proper evidence to back up their claim that investment capacity will be reduced. However, PVV leader Geert Wilders, who had called for the rent freeze, said it would be up to Keijzer to solve the problem.

The €1.1 billion compensation is “far from enough” to cover the expected losses, according to Aedes, the umbrella group for housing corporations, which claims the rent freeze could reduce investment capital by “several tens of billions of euros”.

Just six months ago, Keijzer, housing corporations, developers and investors agreed at a national “housing summit” to scale up housing production.

Keijzer is currently holding talks with finance minister Eelco Heinen to assess the impact of the rent freeze on the agreement. However, according to the Financieele Dagblad, it is highly unlikely that the government will fully compensate the corporations for the shortfall.

Rent control reforms under review

Meanwhile, the four coalition parties have agreed to relax newly introduced tougher rent control rules, following calls from Keijzer to amend the legislation.

The proposed changes, however, remain vague. The measures suggest “fewer homes” will fall under rent controls and that property values will play a larger role in rent calculations. Small landlords — many of whom have begun selling off properties — may also be exempt from some rules.

Keijzer must now evaluate these proposals and work out the details as well, party leaders said.