Pro-business new coalition will encourage economic growth 

After complex negotiations that took 206 days, the new coalition agreement named “Confidence in the future” was presented on October 10th 2017. The programme contains an agreement between four parties with divergent political views: the liberal party “VVD”, Christian-conservative party “CDA”, democrats “D66” and Christian-social/green party “CU”. The plans of this pro-business government are expected to further spur the already well-performing Dutch economy. This has positive effects on the main drivers of real estate markets such as decreasing unemployment, increasing wages and rising consumption. However, not all plans will benefit the real estate market. The planned discontinuation of dividend taxes will smoothen the dividend pay-outs to foreign shareholders, but adversely affect investment vehicles with corporate tax exemptions, such as REITs. If the plans materialise, these funds will have to pay corporate taxes.

In short:

  • Strong employment growth benefits the office market;
  • Increasing consumption will facilitate growth in retail and logistic markets;
  • Opportunities for residential investments in the mid-market rental segment and sustainability-oriented investments.