Yearly increase of rental price in the free sector per July 1 2019

A lessor of living space (s) may annually increase the rent. Although this may be deviated from, it is standard practice in the Netherlands to increase the rental prices per July 1.

Who implements the rent increase?
If Home of Orange carries out the financial management of your home (s), then we also take care of the annual rent increase on behalf of the lessor. If you are the financial manager of the home yourself, then you are responsible for this. If you wish to increase of course, because you do not have to increase. If, for example, you are very happy with your tenant and you would like him / her to rent from you for a longer period, you may consider not to increase or with a lower percentage than permitted. Also an increase per any other date than July 1 is accepted.
Do you find it difficult to prepare the letter for the yearly rent increase? We can help you.

Possible clauses in the rental agreement
Strict rules apply to the annual rent increase in the social sector. The government determines what the maximum rent increase may be, based on the income of the tenant.
Other rules apply in the free sector, where the lessor may (to a certain extent) determine the annual rent increase. All this depends on the provision that is included in the rental agreement. A number of options are possible:
-An indexation clause; the rent is increased annually by a percentage that can be distracted from the inflation figures of the Central Bureau of Statistics (CBS). The rent then goes up with the average price development in our country. For rent increases from July 1 the percentage is 2.8%.
-A storage percentage; the rent increases with the price index figure for consumers plus a storage percentage, for example 2.8% + 2%.
-A market rent provision; the market rent provision allows that, after a few years, the rent is substantially increased in one go in order to bring the rent in line with the market rents for comparable properties. If the lessor uses this clause, he must also be able to substantiate the rent increase on the basis of comparable properties in the neighbourhood.
-No clause for rent increases has been included; in that case the lessor may, in principle, propose any rent increase.

Home of Orange uses the 'indexation clause' in her rental agreements for homes in the free sector (basic rent > € 740.42). This year, the inflation rate for the rent increase per July 1, in contrast to previous years, is relatively high at 2.8%.

Points of interest regarding rent increase
Do you want to increase the rent for your home in the free sector per July 1? Then take the following into account:
-The rent increase is only calculated on the basic rent, not on additional deliveries such as service costs or gas, water and electricity;
-The rent may be increased once every 12 months, even if the tenant rents for a shorter period than 1 year;
-In contrast to the social sector, for homes in the free sector the lessor does not have to inform the tenant about the rent increase within a certain period;
-The lessor may cancel a rental agreement if the tenant refuses to pay the rent increase;
-Rental prices in Amsterdam, Haarlem and the surrounding area are only rising slightly or even stagnating. If your tenant is already paying a rental price that is in line with the market and you are implementing a relatively high rent increase, the tenant may decide to look for another home that is more affordable. Do you have a nice tenant that you would like to keep? Then be careful with an extreme rent increase that potentially causes the tenant to leave. After all, in that case you have to incur costs again to find a new tenant and you also have the chance of vacancy.
-A tenant does not have to agree with the proposed rent increase, but then the lessor can go to court. If the court finds the rent increase reasonable, the tenant will be given the choice to simply pay the extra rent every month. Otherwise the rental agreement will be terminated. Only the court can then terminate the rent.

Do you find it difficult to prepare the letter about the rent increase yourself?
We are happy to arrange it for you. We will then prepare a letter in your name, based on the information you provide, that you can sent to your tenants. We charge € 39.75 incl. VAT for this.

What do we need from you to prepare the letter?
-amount of the current basic rent
-amount of the current additional services and deliveries
-the language of the tenants (Dutch or English)
-the provision in your rental agreement about the rent increase
-the address details of the property
-the name (s) of the tenant (s)
-the name and address details of the lessor (s)