The number of non-rent-controlled properties in the Netherlands fell by 40% in the final quarter of last year compared to the same period the year before, according to research by rental housing platform Pararius.

At the same time, the average rental price rose by 7.7% to €1,730 per month, Pararius said.

Demand for cheaper free-sector properties, with rents between €1,178 and €1,500, has also grown considerably. Properties worth more than 186 points are considered to be in the free sector, which means landlords are free to charge what they like.

In total, 12,274 properties became available for new tenants in the final three months of the year, Pararius said, based on data from its own website, huurwoningen.nl, and other sources.

On average, a new house or apartment attracted 42 responses, slightly up on the same period last year.

“The Dutch rental housing market is in a critical condition, given the historically low supply, rising prices, and the exclusion of a large part of the population,” according to the report.

With an average rent of €1,730 and landlords’ preference for tenants with a salary three times the rent, a tenant would need to earn a gross salary of just under €5,200 a month to be eligible.

Pararius has repeatedly warned that fewer small apartments are coming onto the market as landlords sell them off due to the expansion of rent controls to cover more homes. Around 8% of the properties offered for sale via Pararius are former rentals, the agency said.

“The current situation shows how urgent it is to review government policy and reduce the pressure on the rental market,” said Pararius director Jasper de Groot. “The rental market is drying up, and that has major consequences for flexibility and the entire housing market.”