Amsterdam’s new strategy to boost the supply of affordable housing in the city will instead lead to further shortages and rising prices, according to property advisory group CBRE.
The CBRE report says the city has missed an opportunity because there is a lot of money available for investment in housing but the council’s tough new rules will have an adverse impact on developers.
In particular, plans to place strict rent controls on property just outside the current rent-controlled sector (monthly rents of up to €710) make investing in this kind of property unattractive to investors, the report said.
This means there will be less investment in property with affordable rents (€710 to €1,000 a month), the report said. In addition, the high price of land, coupled with rising construction costs and tougher rules on sustainability will make investments too risky, CBRE said.
The new city administration plans to build 7,500 homes a year, but that is not enough to reduce the shortage of homes to rent, CBRE says. This means owner-occupied and rental properties will continue to increase in price.
City housing alderman Laurens Ivens told the Parool in a reaction that there are enough companies which want to build housing in Amsterdam.
‘Amsterdam can never become a city where only people with a fat purse can live,’ he said. ‘That is why we have to make agreements on pricing.’