Housing cost ratio drops: we spend less of our income on housing

Marnix Hazelhoff

8 Juli 2025

Readingtime 3 minutes

Between 2018 and 2023, the share of household income spent on housing costs in the Netherlands, known as the housing cost ratio, has decreased. This is according to new figures from Statistics Netherlands (CBS). The decline is most significant for tenants in social housing, but homeowners and private-sector tenants are also seeing a relative drop in their housing burden. What does this mean for you as a buyer?

What has changed?

The housing cost ratio is not dropping because housing has become cheaper – in fact, monthly costs have gone up. The reason is that incomes have risen even faster than housing expenses. So despite higher bills, households are left with more financial breathing space.

Key figures:

Social housing tenants: housing cost ratio fell from 31.0% → 25.4%
Homeowners: 20.4% → 17.1%
Private-sector tenants: 33.5% → 30.2%
Income growth: up to +33% over five years
Housing costs increased too: e.g. private rent rose from €853 to €1,045

The largest drops in the housing cost ratio occurred in regions like Friesland and Zeeuws-Vlaanderen. In areas such as Amsterdam, the decline was more modest, partly due to rising energy costs and relatively slower income growth.

Private-sector renting remains the most expensive option

Even though the housing cost ratio is falling, the private rental sector remains the most expensive (both in absolute terms and as a share of income). Yet this segment is growing rapidly: the number of households in private rentals has increased by 23% over five years.

The picture is different for homeowners. Thanks to historically low interest rates between 2020 and 2022 and relatively stable mortgage costs, their housing cost ratio fell by over 3 percentage points. That creates opportunities for buyers, but also means fewer people are forced to sell, keeping the housing supply tight.

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What does this mean for you as a buyer?

A lower housing cost ratio generally means you have more financial room to manoeuvre. That creates opportunity, but also calls for strategy.

What it might mean for you:

More room to increase your bid, without overstretching your monthly budget.
Fewer forced sales means a limited supply of houses, the market remains tight despite lower pressure.
Regional differences are significant: declines are smaller in high-demand areas like Amsterdam.
Inflation and interest rate shifts could quickly reverse the trend, so it is important to stay alert and make financially responsible decisions.

Conclusion

The drop in the housing cost ratio offers buyers a bit more financial breathing room. But if you think that makes the market easier, think again. Supply remains limited, and competition is high.

That extra room can work in your favour – whether you use it to make a stronger offer, invest in a more energy-efficient home, or simply buy with more certainty. But it still requires a well-planned bidding strategy in a market where homes often sell within just a few weeks.