The Dutch urban ground lease: A valuable tool for land policy?

Abstract

Once heralded by both liberals and socialists as a tool for Dutch municipal governments to prevent land speculation and to implement spatial policies, a century later the Dutch ground lease (erfpacht) is now despised by many. The ground lease was the subject of strong debate in the recent past and is likely to remain so. It has been argued that lessees should have the right to become owner of the land, and this ‘right to buy’ has indeed been implemented in the land policies of several municipalities. The Dutch urban ground lease seems to be under serious pressure. Is it outdated or is it still a valuable tool for land policy? Before we answer this question, we firstly will provide an historical overview of Dutch ground lease. Secondly, the different types of ground lease will be elaborated. Thirdly, the focus will be on the urban ground lease used by Dutch municipalities and the developments in the use of this instrument. Fourthly, the recent policy changes will be dealt with, followed by an assessment.