Social Housing Corporation Subsidies

The Engine of Affordable Housing

In the Netherlands, there isn't a direct 'non-profit housing subsidy' that a tenant can apply for. Instead, the entire social housing sector is built on a system of indirect support for the providers: the woningcorporaties (housing corporations). These are non-profit organizations with a legal mandate to provide sufficient, high-quality, and affordable housing for people with low incomes. The government enables them to do this through a robust system of financial backing.

How the System Works

The primary way the government supports these corporations is by guaranteeing their loans. An organization called the Waarborgfonds Sociale Woningbouw (WSW) provides this guarantee. This means that if a housing corporation takes out a loan to build or renovate social housing, the Dutch state effectively co-signs for it. This government backing allows the corporations to borrow money at much lower interest rates than a commercial developer could. This massive financial advantage is the 'subsidy' that allows them to:

• Build new social housing projects.
• Maintain their existing housing stock.
• Charge rents that are legally capped by the Woningwaarderingsstelsel (points system) and are therefore far below the market rate.

For the tenant, the benefit is indirect but profound: this system is the reason that affordable, regulated housing exists at all. The tenant's direct, personal subsidy remains the huurtoeslag (rent allowance), which helps them pay the already low, regulated rent charged by these subsidized organizations.