Why the Spending Power Gap Between Homeowners and Tenants Is Widening in the Netherlands

Why the Spending Power Gap Between Homeowners and Tenants Is Widening in the Netherlands

A recent housing market report by ABN Amro economists reveals a growing divide in spending power between homeowners and tenants across the Netherlands. While rising incomes have outpaced housing costs for many, renters in non-rent-controlled properties now allocate a substantially larger share of their earnings to rent and ancillary living expenses. In this article, we explore the factors behind this widening gap, its implications for different demographic groups, and what tenants and first-time buyers can do to navigate the changing landscape.

Rising Incomes vs. Housing Costs

Between 2019 and 2025, average disposable incomes in the Netherlands increased at a faster pace than both mortgage payments and rents, according to the ABN Amro Housing Market Monitor. Nevertheless, renters outside the regulated sector are now spending up to 38% of their net income on housing and related expenses — compared with just 28% for homeowners.

Key statistics at a glance:

• Homeowners’ housing cost share: ~28%
• Non-regulated tenants’ housing cost share: ~38%
• Increase in average income (2019–2025): greater than rise in mortgage and rent costs

This divergence means that, despite a healthier wage growth environment, many renters are feeling squeezed by steeper rental prices and additional charges such as service fees and utilities.

Homeowners’ Advantage: Locked-In Rates and Equity Growth

Long-term homeowners—especially those who purchased before the recent hike in mortgage interest rates—enjoy relatively low borrowing costs. Early buyers who secured mortgages at historically low interest rates now benefit in two ways:

1. Lower monthly payments: Fixed rates agreed upon years ago remain well below today’s market averages.
2. Building equity: As property values rise, owners see increased equity, which can be tapped for renovations or other investments.

Moreover, some homeowners pay off a significant portion of their mortgage principal over time, further reducing monthly outlays. This creates a virtuous cycle: lower living costs free up disposable income for savings, leisure, and investment.

Tenants Facing Higher Rents and Less Stability

For tenants in the non-regulated sector, the picture is less optimistic. Market-driven rents have surged, particularly in hot rental markets. Unlike regulated (