Tackling the housing shortage: Starts with management, connection and simplification

The consequences of the housing shortage has far-reaching effects, impacting everyone from students and people in their thirties who still live with their parents, to middle-income people who fall through the cracks and the homeless without night shelters. It is indisputable that housing problems and the lack of a stable housing situation have major socio-economic consequences, affecting work, health and education. 

It is therefore not surprising that the word 'livelihood security' often appears in various election manifestos. The issue is more urgent and urgent than ever. By 2030, there is a need for 900,000 new homes. In addition, the current housing shortage will rise from 3.9% to 4.8% this year, largely as a result of rising migration, older people living at home longer and the fact that fewer, and fewer people sharing house. 

How do we address the housing shortage?

In response to the increasing housing shortage, outgoing Minister Hugo de Jonge (Housing and Spatial Planning) said: "We need to build more affordable homes with more speed and more oversight." But: how do you do that in such a complex environment? 

Lennert Middelkoop and Gijsbert Duijzer lead the Deloitte Real Estate team that deals with everything related to residential construction. They are currently working on behalf of the Ministry of the Interior and Kingdom Relations (BZK) to accelerate the realization of temporary accommodations, among other things. 

Middelkoop: "This stemmed from the realization that, beyond analyses and in-depth research, there is a significant need to address the shortage of implementation capacity.” Duijzer: "We are now deeply involved in about 230 housing projects throughout the Netherlands." We help housing corporations, builders, municipalities, provinces, utility parties, among others and look at what is needed to get projects off the ground and bring them towards realisation. We speak to everyone, work with all parties and make a difference in that way."

Bottlenecks

Duijzer and Middelkoop highlight that this is a complex issue. They see four major bottlenecks impeding housing development. Support and locations are the first point. Middelkoop: "We notice that there is often discussion and reluctance at administrative, political and social level to allocate certain locations to focus groups, such as migrant workers." Duijzer: "Space is scarce and there is always a reason why something else has to be put in a certain place. Especially when it comes to people who do not currently belong to the community of a particular municipality." 

A second bottleneck is the business case, which is often impossible to complete at the moment, both for temporary and regular housing. Duijzer: "Causes include rising interest rates and high land and construction costs, which are causing the cost of housing to rise too much. At the same time, you can hardly increase rents in the social rental sector. In addition, locations are now often temporarily licensed for a period of up to 15 years, which creates uncertainty about the future of these homes. This results in a negative business case."

Spatial planning is a third bottleneck. Duijzer: "The regulations surrounding spatial planning were already complicated, and the new Environment and Planning Act will probably lead to uncertainty and delays for many municipalities at first." Middelkoop: "Everyone has the right to have an opinion about it, and there are often many interests at play. Consider, for example, the rules for objections and appeals or the Flora and Fauna Act. It is important that we have regulations for these kinds of things, after all, they deal with important themes such as quality of life and sustainability, but at the moment there is a lack of integrated implementation." 
The final sticking point is utilities. Duijzer: "In many parts of the country, there is grid congestion and a shortage of materials and personnel at grid operators, which leads to long waiting times for electricity connections."

The final sticking point is utilities.
Duijzer: "In many parts of the country, there is grid congestion and a shortage of
materials and personnel at grid operators, which leads to long waiting times for electricity connections."

Active involvement in projects

The big question is how to navigate within this complex landscape and, in particular, what works in tackling the housing shortage. If you want to make a difference as government, you have to take executive control, say Duijzer and Middelkoop. "Active participation in projects is essential," says Duijzer. "That's the only way you can take ownership of the problem and really understand what's going on. Active involvement also validates the policy and helps to identify the real bottlenecks. As a result, you can develop policies and interventions that really solve something."

Middelkoop: "Direction from the central government is needed. When it comes to support and locations, it is an illusion to think that municipalities alone will achieve breakthroughs. This is a task for the entire government."

Duijzer: "The government has to allocate locations, but this must be coupled with active implementation. If, as central government, you are directly and constructively involved in the execution of housing projects and designate locations on that basis, it proves to be more effective and better accepted compared to formulating policy from a distance."

Middelkoop: "A binding policy framework not only facilitates designation but also provides predictability regarding spatial planning decisions across the Netherlands. There is a great need for this, also among professional parties who now often face numerous uncertainties and are hesitant to make substantial investments, such as installing a robotic production line in a housing factory." 

Simplifying problems

Duijzer and Middelkoop believe that, in addition to directing and participating in project implementation, the central government has a crucial role in reducing complexity. Middelkoop: "In the 230 projects we are involved in, we are constantly address obstacles as they arise. We tackle each issue individually and work to resolve it.”

Duijzer: "Projects often get bogged down due to an abundance of challenges. It really works to tackle these one by one. However, it is important for all parties to come together, show courage, and be willing to make concessions." Middelkoop: "In addition to providing direction and understanding the local situation, it is also the task of the central government to bring all relevant parties together to collaboratively seek solutions together. It sounds so simple, but we often notice that people can sometimes talk about each other for years, while they barely know each other." 

It is far from easy to design effective housing solutions for the Netherlands. That's why Middelkoop and Duijzer say: turn it around. If it's that complex in a particular area, engage directly with the local parties involved. Middelkoop: "Take control, so that the implementation benefits from it and not the other way around. Give clear guidance and help where necessary. Sit with the construction team or project group and ask: what do you need to build a certain type of home faster? And then adjust your requirements, policy and direction accordingly.

"Duijzer: "Direction and execution are inseparable. If you want to create support for that directing role, implementation is always part of it. Engage directly with individual projects and take action. The rest will follow. After a visit to a construction site, town hall, housing corporation or participation evening, you always go home with the idea: things can be done differently, simpler and less complex."