A compromise has been reached on plans to reform the housing sector which will, according to NRC, cost some 290 million euros.

The agreement was reached between the coalition and three opposition parties, the Christian Union, D66 and SGP, after the original plan was thought to be too harsh on tenants. The coalition required the support of three parties in opposition in order to ensure a majority.

The plan has been drafted in order to kick-start the housing sector after the construction sector saw a nine percent downturn in the fourth quarter of last year.

Though it is not yet known where the extra 290 million euros will come from, the plan has been received positively by the construction industry.

The major points include:

› A reduction in a proposed extra property tax for housing corporations from 2,1 billion euros to 1,7 billion

› Rent for those in social housing will rise by a maximum of 6,5 percent and not 9 percent as was originally proposed

› Value-added-tax on renovations will be cut from 21 percent to 6 percent, starting this March and last one year

› People who encounter economic difficulties, such as being made redundant, may be entitled to a reduction in their rental costs

› A fund for first-time buyers has been increased to 50 million euros and 150 million will be invested into a fund toward energy efficiency

› Rent for social housing will not be determined by the value of the property and the old points system will remain in place

› Tax relief will be provided to anyone who has a special or hybrid mortgage which also involves 50 percent repayment. Previously the plan was to extend this to only mortgages with 100 percent repayment plans.

Source: NRC