The Dutch government has a number of measures to stop the turmoil in the Dutch housing market. This list is expanding steadily. Tax breaks for homeowners should be reduced. A lower land price is needed for social housing. The landlord levy should be eliminated. Ordinances that set minimal percentages for social housing – rental and purchase – for specified target groups. Developers are not eligible for equalization funds. Smart purchase schemes. Obligation of the occupier to be the owner Municipalities exercising their first rights of purchase of land. Allowance of first right of purchase to residents who then wish to purchase properties.
This is just one example from a vast array of options. Unprecedented amounts of public cash are being channeled to large-scale housing estates to help accelerate housing construction and absorb unprofitable caps that this boom appears to be unable to address.
What has this done so far? Statistics Netherlands’ population projections (CBSThe Netherlands will have 8.7 millions households by 2030. This means that 800,000. more households will be needed. More homes are needed to accommodate everyone. However, the current urban planning foresees no less than 961,000.300 residences. This means that the planning capability is greater than 130 per cent of what’s needed. This is great news. Quantity is no longer the greatest problem. It is important to note that the housing shortage can be scientifically difficult and, as with inflation, may even be desirable.
Then there is affordability. This is a very different challenge. Since almost a decade ago, the housing market has seen a sharp increase in prices. This has created a shortage of affordable housing while increasing the potential revenue for housing development. This is having a major effect on the strategies used by investors and property developers. The city is becoming a hub for unbridled capital accumulation, where ruthless forces dominate. These forces can only be stopped by a counterforce. Despite decades of deregulation, the Netherlands has lost much of its national control over how much and where it is built.
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This context is important. EHVXL, a knowledge and community platform in urban development in Eindhoven, studied housing programs that provided desirable housing types and quantities across a variety of municipalities. These municipalities use all sorts of methods to regulate housing markets. However, they tend to be restrictive and only have a temporary impact. They have a limited but not permanent impact on the determination of housing price. These programs will not result in affordable inclusive cities or towns. In the short-term and certainly not over the long-term.
Innovation is crucial to turn the tide. In order to create a more affordable and inclusive environment, it is necessary to develop a new model in which the public as well as private domains can be interconnected in a new manner. Why wasn’t this done a long time ago? Why not focus the national knowledge infrastructure of this critical issue? Make a few A4 sheets, and then form coalitions to implement the model. There are 20 professors currently doing scattered research on the housing market. They are enjoying a nostalgic view, and riding their own hobbyhorses with no central coordination or focus. Rare initiatives to do the right thing come from the social domain, and often end up in the trash.
Yet, there are so many opportunities left untapped. We are all constantly trying to create a better living environment. This, however, is also steadily increasing in value. There is plenty of money. Some of this money ends up in the wrong spot. The Netherlands has very few demands from local authorities regarding compensation for developers not recovering their costs. They also don’t make any demands for future development of greater value. On the other hand, you constantly hear from developers and governments: ‘We can’t make ends meet, we have to postpone, scale down or even cancel projects.’ Even during this boom period, with the unprecedented financial support from the government.
Why not use a portion of the future value we all create to benefit society? This seems like a great choice for the core model of a new model. This is possible because there are no laws or rules that would prevent it. And there are plenty of examples all over the world on how to make an increasingly value-based living environment not only affordable, but also more inclusive – not to mention more sustainable.
About this column
Eveline van Zeeland writes alternately a weekly column Eugne FrankenInnovation Origins is a group of people who are trying to predict the future. These columnists are sometimes joined by guest bloggers who work in their own ways to solve the problems of our times. So tomorrow is good.
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