The fixed-term tenancy agreements act

The fixed-term tenancy agreements act (Wet vaste huurcontracten) has been approved by the Senate and will come into effect for new lease agreements from next year (possibly July 1, 2024). Fortunately for landlords, there are still plenty of options for temporary rentals! For home seekers, however this is no good news, as many landlords who are not willing to immediately enter into an indefinite contract may now not let at all.

For specific groups of tenants, it will become even more difficult. The government is now introducing a regulation* that excludes certain target groups from temporary rental. Since the same government is not going to ensure a healthy rental housing market, there are tenants for whom it will (still) be impossible to find rented housing.

Because it would be pleasant for all parties if a rental housing market continues to exist, I will start by listing what is still possible when you want to let your property.

What is still possible?

  • Temporary lease agreements based on interim rent/diplomat clause, these contracts are intended for homeowners who temporarily live elsewhere and for that reason, rent out their home.
  • Temporary lease agreements based on the Vacant Property Act, intended for homes for sale or designated for demolition or renovation.
  • Target group contracts, intended for, among others, students, large families, etc.
  • Existing temporary lease agreements are not affected by this new legislation.
  • Temporary lease agreements concluded before the entry into force (July 1?) of this new law still use the current regulations.
  • Furthermore, the government formulates some exceptions. Tenants with whom a (regular) temporary lease agreement may still be concluded. Note, the measure regulating this still has to be adopted*. In short:
    • International students;
    • Tenants who temporarily have to leave their living space due to renovation;
    • People with an urgent housing need;
    • Tenants with a last chance agreement;
    • Orphans of tenants;
    • People in a divorce with children;
    • Former addicts who temporarily need guidance.
  • And now, two entirely new possibilities, the conditions of which are not yet entirely clear:
    • A private individual letting 1 property may have the option to terminate the lease if they intend to sell the property.
    • A landlord wishing to let the leased property to a parent or child also gains termination options, provided this is stipulated in the lease agreement in advance.

What has the Senate approved?

Abolition of the fixed-term lease for a maximum of 24 months (5 years for non-independent living space). This lease agreement (which we call “Short Time” at Interhouse) gives landlords the opportunity to conclude a lease agreement for a maximum of 24 months. In recent years, we have often seen that landlords who are letting for the first time or are not sure if they want to let forever are helped with this lease agreement and decide more easily to offer their home at all.

What now?

In the current overheated market, it is easy to find a tenant to whom a temporary contract may be offered, so for landlords who do not immediately want to be bound to a tenant forever, there seems to be not much of a problem. But the tenant who does not fall under the exceptions is worse off, they will be even further back in line. Hopefully, the new government will focus on creating conditions for a healthy housing market in which investors like to invest. Anything is better than overregulation and thoughtless patching up self-inflicted wounds.

*Note

The legislation that regulates the exceptions is still open for consultation. So, express your opinion before December 4, 2023! For example, we miss expats (knowledge migrants) in the enumerated target groups, an important target group for the Dutch economy.

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