If we don't act quickly, the construction and real estate sector, responsible for a staggering 12.9% of the Dutch GDP, will face rough waters, and the Netherlands will be headed for a prolonged recession comparable to over a decade ago. Minister De Jonge recently launched the start-building impulse to pull the construction sector out of the slump. With overwhelmingly great success, which once again underscores the seriousness of the situation. One of the largest pillars of the Dutch economy seems to be grinding to a halt, and there is an urgent search for external assistance, of which the first step has been taken by the minister. If the sector comes to a standstill, the revenues of municipal land companies will dry up, order portfolios of construction companies will shrink, and unemployment within and outside the sector will rise.

Stagnation in the housing market

The numbers speak volumes; the housing shortage is now 390,000 homes, more than the city of Utrecht accommodates. Are we not achieving the goal set by our government, with the support of a parliamentary majority, of building 100,000 homes per year? We seem farther from this goal than ever before. The number of applications for environmental permits is decreasing rather than increasing. In 2021, there were still 76,000 applications, but in 2022, only 63,000, and in 2023, it is expected to be less than 55,000. Meanwhile, the housing shortage is reaching unprecedented levels, housing construction is coming to a standstill, and the flow of housing, which is crucial for providing relief to the lower end of the market, is stagnating.

Billions for start-building are urgently needed

The first inventory of the need for the start-building impulse shows that with 3.2 billion euros in subsidies, housing associations, municipalities, and developers will be able to build a staggering 260,000 homes in just 2 years, of which as much as 50% are affordable. However, the available budget from the government is capped at a maximum of 300 million euros. With a maximum subsidy of €12,500 including VAT per home, not even 10% of the potential can be built. The start-building impulse scheme is a bull's-eye, given the number of applications, but due to the limited subsidy budget, the impact will remain very small.

The government's budget is at stake

Thanks to the minister, who launched the start-building impulse, politics now has a tool to avert a crisis. The construction and real estate sector are the engine of our economy, a gold mine for our national budget, and a significant employer for the Netherlands. The subsidy for the start-building impulse must be significantly increased. Because without a vital construction sector, the engine of the Dutch economy will come to a standstill, mass layoffs will occur, and we will plunge into a prolonged recession. The construction and real estate sector must therefore be cherished. The required 3.2 billion for the start-building impulse is nothing more than self-evident on a national budget of 433 billion. Especially when you realize that every new home, sold for an average of €460,000 including VAT in 2022, contributed a staggering amount to the treasury. The government, both locally and nationally, receives back multiple folds through VAT, fees, local taxes, and land income. If we are not careful, the household budget of municipalities will come under further pressure, and working families will become the victims. The start-building impulse should no longer be seen as a subsidy but as a self-evident investment in the economy to simply keep the government's household budget in order and to avert a years-long crisis and recession, similar to what occurred in 2008.