Entry into force of Affordable Rent Act and Periodic Tenancy Agreements Act

On 1 July 2024, the Affordable Rent Act (Wet betaalbare huur) and the Periodic Tenancy Agreements Act (Wet vaste huurcontracten) entered into force. In this news update, we will outline the main changes.

Affordable Rent Act

The Affordable Rent Act introduces a new rent-controlled residential category. In addition to the already regulated (social housing) and liberalised (private sector) markets, a new rent-controlled mid-range segment has now been created. The rent-controlled residential range has been expanded to include properties of up to and including 186 points based on the housing evaluation system (woningwaarderingsstelsel, or WWS), which translates into a maximum rent of EUR 1,157.95 per month. In this new category (social housing and mid-range), it is not permitted to let a home for a rent higher than the maximum permitted under the WWS.
 
The Affordable Rent Act also revises the WWS in a number of respects. For example, the inclusion of the value under the Valuation of Immovable Property Act (Wet waardering onroerende zaken) has been capped differently, energy labels carry more weight, and an attempt has been made to objectify and simplify the WWS. Other aspects regulated by the Affordable Rent Act include the following:

These new regulations apply to new tenancy agreements concluded on or after 1 July 2024. In addition, the Affordable Rent Act provides that, from 1 July 2025, landlords will in some cases be obliged to lower the rent under (liberalised) tenancy agreements concluded before 1 July 2024. This will be the case when, based on the WWS, the rent for the property in question actually fell within the social housing segment applicable until 1 July 2024 on commencement of the tenancy agreement, but a higher rent was agreed at the time. In those cases, the rent must be lowered to the maximum rent applicable under the WWS by 1 July 2025. 

The Affordable Rent Act will be regularly reviewed.

Periodic Tenancy Agreements Act

Until 1 July 2024, it was possible to conclude fixed-term tenancy agreements for self-contained and shared properties, for a maximum term of two and five years, respectively. The Periodic Tenancy Agreements Act has changed this, to the effect that these fixed-term tenancy agreements will, in principle, not automatically end on expiry of the agreed period. Regular termination of a residential tenancy agreement must be effected in all cases by giving notice, with the landlord being bound by the exhaustive grounds for termination listed in the Dutch Civil Code (DCC). However, fixed-term tenancy agreements concluded before 1 July 2024 are still considered fixed term and will end, in principle, when the agreed fixed term expires.
 
Only in specific – special – cases will it be possible from 1 July 2024 to conclude a fixed-term tenancy agreement that ends automatically on expiry of the agreed term. The Specific Groups for Fixed-Term Tenancy Agreements Decree (Besluit specifieke groepen tijdelijke huurovereenkomst) defines the persons with whom fixed-term tenancy agreements may still be concluded. The list includes students, persons in emergency accommodation or a social emergency situation, a deceased tenant's surviving dependants (in certain cases), residence permit holders (asylum permit holders), etc. For a full list of the specific groups, please refer to the aforementioned Decree (in Dutch).

Further, the Periodic Tenancy Agreements Act also offers some relaxation of the rules, by introducing a new ground for termination for landlords of residential properties and expanding an existing ground for termination. The new ground for termination has been created for – to put it very concisely – homeowners who have moved in with someone else and ultimately want to sell their home (unlet). In addition, the existing ground for termination 'urgent own use' (dringend eigen gebruik) has been expanded. Landlords who want a relation by blood or affinity in the first degree to occupy their rental property (such as parents or children) can invoke this ground for termination, provided that this ground has been included in the tenancy agreement.