Social housing requires Dutch courage

Given the variety of ways to define social housing, agreement on one single clear-cut definition is difficult. However, there is consensus that housing policies should take into account those households that cannot meet their housing needs unaided. Furthermore, social housing provision needs to be guided by certain criteria. Commonly, the housing provision involves many actors. The Netherlands has been and still is one of the most dynamic and innovative countries in Europe with respect to social housing.

Dutch social housing policy states that every Dutch resident has the right to live in a residence with basic sanitary conditions, a kitchen and a bedroom. This means that in reality no Dutch inhabitant is homeless unless they wish to be. Today in the Netherlands housing associations have the reputation of being social entrepreneurs as opposed to mere extensions of the government. The fact that these associations have to finance their own investments now, which naturally entails a lot of risk, encourages them to behave as entrepreneurs to a large extent. Social housing organizations have always remained “social” entrepreneurs bound in their obligation to work exclusively for the good of social housing. Considering the fact that the social rental sector accounts for 37% of all Dutch housing stock, renting is obviously the most important task of social organizations. The rules for how to determine social rental prices and the annual rent increases are in the Residential Rent Legislation. The maximum rent that can be charged is based on the dwelling evaluation system. Dutch residents are eligible to rent property through social housing, albeit with a maximum income of €36,798 a year when in workforce or €30,400 when they are a state pension beneficiary.

The Dutch government makes use of a specifically designed system to define the quality of a property expressed in points, which is based on the surface area, the number of centrally heated rooms, sanitary and cooking facilities and the cadastral value. The accumulated points are linked to a maximum rental price – the lessor cannot legally cross this rental boundary. To ensure affordable rental prices, the majority of social housing is owned and supervised by housing corporations.

Though effective, this system is definitely not bulletproof. This points system has changed throughout the years, for example, when safety policies have been added. In addition to the adding of policies, the economy affects not only the income and rent allowance of possible tenants, but it also affects the rental prices. This can increase the social insecurity among tenants when it is security they seek and were promised in the first place.

The private housing section is affected as well. Due to social housing, private sector prices are rising, both in the rental housing sector as well as private property sector. 84% of rental properties are social, making it extra hard for private properties to be rented out as buying seems more efficient in the current economy. In this situation, making profit is near impossible for landlords who work outside of housing corporations, which puts them at a disadvantage. As the prices rise, private housing is becoming increasingly unaffordable for the middle class whose income are just above the maximum income for social housing. This rise of prices is an excellent example of cause and effect and creates a cycle in which those with a tight budget are under represented and struggle to find an affordable residence. This is an unavoidable problem within the rental sector, which presents itself as minute, but is in reality a potential threat to the resurrected residential market in The Netherlands.

Notwithstanding the drawbacks of the social housing policy of the Dutch government, it has been, and continues to be effective in making sure residents live in a safe area and home, whilst also decreasing the number of homeless people. To add, social security has always been an important matter for the Dutch government, and is ever-changing to seek improvement.

In the budget memorandum of 2018, published by the Dutch government, €3.9 billion (£3.5 billion) has been put towards housing. This takes the steep decline of rent allowance in consideration, as the Dutch economy is flourishing, unemployment is falling and wages are rising. This is a slight advantage for The Netherlands concerning social housing, as less people are in need of it.

When it comes to improvement of policies, the UK could use The Netherlands and their approach towards social housing as a leading example, as the Dutch government see improvement of social housing as a necessity for the well-being of their socially weaker inhabitants. This is a constant factor in the changing policies of the Dutch government. If we compare the €3.9 billion (£3.5 billion) the Dutch government have put towards social housing to the £400 million the English government have set aside in order to solely improve existing social housing, the UK could be said to be lagging behind.