Based on new research, international real estate advisor Cushman & Wakefield reveals that the investment recovery in the housing market in 2024 was primarily driven by divestment and short-term strategies rather than new construction that expands the rental stock. The study, conducted with the University of Amsterdam, places the shift in the context of recent policy changes (including the Transfer Tax Differentiation Act and the Affordable Rent Act). Cushman & Wakefield's findings are in line with the SEO report 'Investment climate for mid-market rentals', published this week, which also concludes that the investment climate has deteriorated sharply due to frequent policy changes and less predictable regulation.
The study shows a clear correlation between policy changes and shifting investor behaviour and underlines the importance of predictable, differentiated regulation to steer capital towards construction production and affordable rent. Policies designed to help first-time buyers and middle-income earners have in practice led to reduced willingness to invest, more adjustment and circumvention strategies and, especially among foreign investors, lower investment appetite. The recovery in investment volume in 2024 is mainly due to opportunistic strategies and not to new construction initiatives that contribute to increasing the housing stock.
Annelou de Groot, CEO Cushman & Wakefield Netherlands: "The paradox is clear: the intention was more affordable rent, but the outcome is a shrinking private rental housing stock. SEO also confirms that predictable government policy is key to restoring the investment climate. This can only be achieved with stable, differentiated policy that aligns with what pension and insurance capital needs to invest. Stability is not a gift to investors, but a precondition. That is why I emphatically advise the next cabinet: stop changing the rules every year and opt for a fixed multi-year framework that enables institutional investors to invest again."
Key findings
- During deregulation, the actual investment volume exceeded the model-expected path; under new regulation, it fell just below (see figure 3 with blue/orange marking).
- The 2024 recovery was largely driven by divestment and short-term strategies, not by new construction that increases housing stock.
- Investors who hold their assets are more likely to use adaptation or circumvention strategies (e.g. splitting, renovating, becoming more sustainable) to stay above regulatory thresholds – within the rules.
- Foreign capital changed profile: after withdrawal in 2022–2023, a selective, short-cyclical inflow began in 2024, often with a divestment strategy.
- In interviews, investors do not so much cite the regulations themselves, but rather their unpredictable nature as a reason to invest elsewhere: "The rules have become so unpredictable that we no longer dare to set our policy ten years ahead," says an interviewed asset manager. " In Germany, we know where we stand."
Roel Timmermans, Head of Living Cushman & Wakefield Netherlands: "Our data show that the recovery in 2024 mainly came from divestment and short-cycle strategies, not from new construction that expands the housing stock. The key lies in predictability: with a multi-year, differentiated regulatory framework, capital shifts from selling to building, especially in the mid-rent segment. This allows the private rental housing stock to grow again."
Background
The research was conducted by Cushman & Wakefield in collaboration with Sifra Brook (University of Amsterdam), who graduated at C&W Living on 16 June 2025. In her thesis, Brook calculated an expected investment volume by means of a multiple regression analysis based on macroeconomic variables such as gross initial yield, inflation and unemployment. This was compared to the actual volume registered in the Cushman & Wakefield database. The deviations between expected and actual volume coincide with moments of policy change. Both residue analysis and interviews with (international) investors point to regulatory uncertainty as a determining factor in investment behaviour.
The SEO report published this week refers to previous research by Cushman & Wakefield and confirms the role of policy predictability as a determining factor for investment willingness. Both studies show that turbulent policy leads directly to declining construction production and a shrinking rental housing stock.
The research reveals a clear gap between policy intent and market outcome. Although measures such as the Affordable Rent Act and the increase in transfer tax are intended to ensure affordability and give middle-income earners access to the rental market, in the short term they will lead to strategies that actually reduce the rental stock. Brook concludes that regulations that treat investors as one homogeneous group miss the mark. Only predictable and differentiated policy that is in line with the type of investor, the investment profile and the housing segment can sustainably direct capital toward social goals: affordability and housing production.
