The Netherlands is working hard to provide enough affordable housing for everyone. The government is deploying a wide range of measures to achieve this. But does it have adequate control over how much is being built, what is being built, who is it being built for, and how it is being built? After all, the lists mainly involve the usual standard issues. So far, this has even led to a decline in housing construction.
Governments today are mostly pursuing a passive land policy. With a passive land policy, you leave a lot to market parties whose expertise you want to make use of. You do not buy the land yourself and you make agreements with the owner about the construction terms. All this fits in with the current regimen of market forces and liberalization.
Friendly government regulator
Still, I am somewhat concerned about the future. Can you really make a stand against the power of the market that way? The market is bound to say: ‘There is a shortage and the Netherlands is now a very attractive location, so, I am going to raise prices.’ A friendly governmental regulator waving them on will hardly even be noticed by the market racing past.
Before the financial crisis, municipalities made substantial profits on land holdings. During the crisis, this trend was reversed and they suffered hefty losses. Land values dropped and the land that was still held could not be sold, which led to high interest rates. This loss of public money from land was the nail in the coffin for the active land policy.
Fixed low price
And that happened, despite the fact that the Netherlands is known for high-quality housing construction that is specifically due to the implementation of an active land policy and integrated regional development. Municipalities bought land, got it ready for construction, and then sold it on. For example, to housing corporations for a fixed low price. Large numbers of housing could be developed quickly this way.
Successful housing development all starts with having enough money to invest in risks, the administrative capacity to properly develop residential projects, and the willingness to use binding legal instruments. It seems that regulating it from a governmental perspective has been all too non-committal.
The growing shortage of (affordable) housing should therefore prompt the government – as it has in the past – to become much more actively involved. This also applies to the land market. In addition to continuing to steer initiatives by developers by utilizing stimulating and restrictive policies, it is imperative that the initiative to build be taken once more.
Mine the past to make the future
Just start by building large-scale and suitable affordable housing with a governmental development company. For a variety of generations and sustainable, integrated with greenery, linked to mobility systems, and so on. No rules are standing in the way of that.
Plus, it would not be the first time. After World War II, our public housing accommodated a whole country. Even during earlier housing crises in the early 20th century, government initiatives provided enough housing and healthy living conditions to replace unsanitary slums and overcrowded cities.
Sometimes you have to mine the past to make the future.
About this column
In a weekly column, written alternately by Wendy van Ierschot, Bert Overlack, Eveline van Zeeland, Eugene Franken, Jan Wouters, Helen Kardan, Katleen Gabriels, Mary Fiers and Hans Helsloot, Innovation Origins tries to figure out what the future will look like. These columnists, occasionally joined by guest bloggers, are all working in their own way on solutions to the problems of our time. So that tomorrow is good. Here are all the previous articles.