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Rental Contract Liberalisation in The Netherlands: Effects on Rents, Vacancy Rates and Residential Mobility

Author

Listed:
  • Maureen Lankhuizen

    (Vrije Universiteit)

  • Jan Rouwendal

    (Vrije Universiteit
    Tinbergen Institute)

Abstract

On 1 July 2016, the Wet doorstroming huurmarkt (Rental Market Transition Act) was implemented in the Netherlands. This law made it possible to temporarily rent out a property for a maximum of two years. The law was created to promote flexibility in the rental market. In particular, better allocation of households was the goal. This paper empirically analyses the impact of temporary contracts by considering the frequency of short stays (up to 2 years). We investigate the changes in this frequency since 2016. We also consider possible implications of the introduction of temporary contracts for rents, residential mobility, and duration of vacancy. We quantify the benefits of short stays to landlords, which mirror the cost of tenants, in terms of higher rental revenues. We also find that residential mobility in the private rental market increased significantly after temporary contracts were allowed, not only in the first 24 months of stay, but overall, as intended by the law.

Suggested Citation

  • Maureen Lankhuizen & Jan Rouwendal, 2024. "Rental Contract Liberalisation in The Netherlands: Effects on Rents, Vacancy Rates and Residential Mobility," De Economist, Springer, vol. 172(4), pages 257-290, December.
    • Handle: RePEc:kap:decono:v:172:y:2024:i:4:d:10.1007_s10645-024-09445-3
    DOI: 10.1007/s10645-024-09445-3
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    References listed on IDEAS

    as
    1. Jan Rouwendal & Antonia Petrat, 2022. "Mortgage underwriting and house prices: Evidence from the 2011 change in the Dutch Code of Conduct for mortgage loans," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 50(4), pages 1141-1159, December.
    2. Christopher A. Pissarides, 2000. "Equilibrium Unemployment Theory, 2nd Edition," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262161877, December.
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    More about this item

    Keywords

    Housing market; Private renting; Short stays; Residential mobility;
    All these keywords.

    JEL classification:

    • D47 - Microeconomics - - Market Structure, Pricing, and Design - - - Market Design
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets

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