How the Affordable Rent Act Conflicts with Property Rights in the Netherlands

The Affordable Rent Act, introduced in the Netherlands in July 2024, aims to address the rising costs of housing by ensuring more accessible rental prices for tenants. While well-intentioned, this legislation raises significant legal concerns, particularly regarding property rights. In its current form, the Act arguably infringes on the fundamental rights of property owners, creating a legal imbalance that may be incompatible with principles enshrined in both Dutch law and European jurisprudence. Here, we outline five core legal arguments for the repeal of the Affordable Rent Act.

1. Violation of the Right to Property

Property rights are protected by Article 1 of Protocol No. 1 to the European Convention on Human Rights (ECHR), which guarantees every person the right to the peaceful enjoyment of their possessions. The Affordable Rent Act, by imposing caps and restrictions on rental prices, directly impacts landlords’ ability to benefit economically from their properties. Such state intervention challenges the core of property rights, as it restricts the owners’ autonomy to manage their assets in a manner of their choosing. In effect, the Act encroaches upon the rights of property owners without sufficient justification.

2. Deterrent to Investment in the Rental Housing Market

The need for private investment in housing is crucial for addressing the current housing shortage. By artificially limiting rental income through price caps, the Affordable Rent Act diminishes the potential returns for property investors. This deters both domestic and international investment in the rental market, as investors may consider the environment too restrictive for profitable returns. Consequently, the Act not only hampers the construction of new rental properties but also fails to support the urgent demand for housing, which contradicts its own stated purpose.

3. Inequitable Treatment of Property Owners

The Act’s broad application fails to distinguish between different types of property owners, affecting small-scale landlords disproportionately. Many small-scale property owners rely on rental income as supplementary retirement funds or personal savings. By applying the same rental restrictions to these individuals as to large institutional investors, the Affordable Rent Act creates an inequitable burden on those without substantial financial reserves. This lack of proportionality could be argued as discriminatory, failing to recognize the different economic circumstances of small versus large property owners.

4. Reduction in Property Maintenance and Housing Quality

Legally, property owners have an obligation to ensure that their rental properties meet adequate standards of safety and livability. However, with rental income artificially capped, landlords may lack the financial flexibility to invest in necessary maintenance, repairs, and upgrades. This restriction may ultimately result in a deterioration of housing quality, as landlords are economically pressured to minimize maintenance expenditures. From a legal standpoint, the Act could inadvertently create a scenario where tenants’ rights to safe and well-maintained living conditions are compromised, as landlords lack adequate resources to fulfill these obligations.

5. Restriction on Economic Freedom



Economic freedom is a fundamental component of a functional market economy and is protected under both national and European law. Property owners, in exercising their economic rights, should be free to set rental prices based on market demand, provided they do so within the framework of lawful conduct. The Affordable Rent Act interferes with this economic freedom, effectively mandating how property owners must manage and profit from their assets. This intervention risks creating an unsustainable market environment, ultimately leading to a stagnation in housing availability and undermining the principles of a free and fair market economy.

While the Affordable Rent Act was introduced with the aim of addressing the housing crisis, its impact on property rights is legally problematic. By encroaching on owners’ rights to economic freedom, equal treatment, and the lawful enjoyment of their property, the Act undermines fundamental legal principles and fails to balance the rights of landlords with the needs of tenants. Given these concerns, a careful reassessment of the Act’s provisions is essential. A repeal, or at least significant revision, is necessary to protect property rights and encourage a healthier, more sustainable rental market that respects the interests of all stakeholders within the bounds of established law.