Rents in the rent-controlled housing sector are set to reach an average of €543 by 2017, boosting housing corporation income 22%, according to a report by the social housing fund WSW.

At the same time, housing corporations are winding down their new building programmes in order to pay a €1.9bn extra levy to the government, the WSW says.

Under EU law, only households with an income of below €33,000 a year are entitled to live in rent-controlled housing. The government is allowing landlords to increase the rent for higher earners by more, in an effort to encourage them to leave the social housing sector.

Dramatic

A spokesman for the tenants’ association Woonbond said the forecast rise is ‘dramatic and unacceptable’.

‘Many tenants are already in financial difficulty. This will exacerbate the poverty problem. People will soon have no money left to buy food,’ Ronald Paping told news agency ANP.

Housing corporations have plans to build 105,000 new self-contained homes over the next five years. That is down 28% on a year ago.