Municipality proposes cutting rise in ground lease by half

The Hague Municipal Executive has sent a proposal to the municipal council to reform the ground lease (erfpacht) system. This has occured because the costs for some residents have increased dramatically the past year.

The Hague has approximately 77,000 ground lease contracts. These contain agreements on the ground rent (canon) which a property owner (leaseholder) pays for the use of the land owned by the municipality.  

Bezuidenhout

In Bezuidenhout there was an enormous increase in 2023. Residents had to start paying an average of € 2,400 per year after the ground rent was recalculated. This was due to high interest rates. And because the land had increased in value. This led to a great deal of unrest among leaseholders.

The municipal council then asked the municipal executive to investigate how these types of increases can be prevented. The results can be found in the proposal which was sent to the municipal council. The municipal executive wants to change the system in order to prevent leaseholders from having to face big fluctuations in their ground rent.

Average interest rate

The municipal executive has proposed that the ground rent from now on be based on the average interest rate over a period of 10 years. This will save a lot of money. People can deduct the ground rent from their taxes.

The municipal executive has suggested that this measure will apply to everybody whose ground lease right will be reissued. People who have a perpetual ground lease will get 1 chance to switch over to the new system.

Safety net

The municipal executive does not expect many people to still get into trouble after the ground lease system is changed. The municipality is helping the people who nonetheless are facing financial problems. This is why the municipal executive has proposed providing leaseholders who have a gross annual salary below € 60,000 with the option of postponing their duty to pay the new ground rent until they sell the property. If people are facing financial difficulties due to an increase in their ground lease, the municipality will help them on an individual basis.

Municipal council

The council committee on Space will discuss the proposal. Afterwards the municipal council will take a decision. Leaseholders who already received an offer for a ground lease right in 2023 will get a new offer once a decision has been taken.

Questions?

Do you have any questions about ground lease? You can contact the Erfpacht department. The telephone number is (070) 353 52 40. You can call Monday to Friday between 9.00 and 16.00 hrs. You can also send an email to Begin link: erfpachtbedrijf@denhaag.nl, end link. .

More info

• Begin external link: Raadsvoorstel Erfpacht: stelselwijziging (RIS317822)(External link), end external link.
• Begin external link: Raadsmededeling Erfpacht: stelselwijziging (RIS317829)(External link), end external link.

Also see: Ground lease