Cap on rent increases in private sector confirmed

Karima Bol and Laura Verëll have written a publication on the Dutch Rent Increase Cap for Liberalised Tenancy Agreements Act (Wet maximering huurprijsverhogingen geliberaliseerde huurovereenkomsten).

On Tuesday, 23 March, the Act was passed by the Dutch Senate. The new act will enter into force on 1 May 2021. Under the new act, starting 1 May 2021, the maximum annual increase that is permitted for rents in the liberalised market will be that year’s inflation plus 1 percent. This means that any arrangements between landlords and tenants that provide for a rate of increase that exceeds this cap will become invalid. This is seen as a considerable constraint on the principle of freedom of contract.

The new act will remain in force for three years, starting on 1 May 2021. It will be reviewed within two and a half years after its introduction to decide whether it should remain in effect beyond the initial three-year period. During that time at least, any clause in a tenancy agreement will be invalid in so far as it results in a higher rent increase than is legally allowed.

Read the publication 'Cap on rent increases in private sector confirmed' here.