Prinsjesdag 2022: these are the changes affecting you

“The situation in the housing market is grim. A decent, affordable owner-occupied or rented house is unattainable for an increasing number of people, especially for first-time buyers and young people. That’s just unacceptable. Everyone has the right to their own home in a safe, accessible and appealing neighborhood, and that’s a key task for the government.” That is basically what King Willem Alexander said in the Troonrede (Speech from the throne). Viisi has put together an overview of the most important points with regard to housing and the housing market for you.

‘Due to high property prices and rising mortgage interest rates, the monthly costs for financing owner-occupied homes have been increasing sharply, especially for first-time buyers. This makes it more difficult for those parties to find affordable housing’, according to a statement by the cabinet in the Miljoenennota (Budget Memorandum).

‘In addition, the scarcity and increased property prices are causing higher rents in the free rental sector, which increases the housing costs of tenants relative to income, and impairs the flow of social renters to the free rental sector. There are also fewer rental properties available for people with a median income. The consequences are particularly significant for households with a lower (median) income, for whom housing costs account for a relatively large share of their total expenditure.’

Here are the most notable measures that will affect home owners and buyers:

• In 2023 and 2024, a total of € 300 million will be released for the Nationaal Isolatieprogramma (National Insulation Programme). This is a multi-year programme to enable the improved insulation of homes. Thanks to the additional funding, more households will be able to make their homes more energy-efficient (sustainable), and thereby save on their energy costs.
• It will become cheaper to purchase solar panels due to the reduction of VAT to 0%.
• In 2022 and 2023, the tax relief for citizens will amount to approximately € 4.8 billion. This relief is partly due to the compensation of the higher energy prices across these years. Because these measures are largely temporary, the effect will be lost in 2024 and 2025, which means that in the 2 years after that there will be an increase in burdens in these areas.
• With regard to energy tax, the costs will be gradually shifted from electricity to gas from 2024 onwards.
• Property investors and buyers of business premises are set to pay a higher property transfer tax. The rate for these groups will be increased from 8% to 10.4%. First-time buyers below the age of 35 will not have to pay property transfer tax when purchasing their home. Buyers from the age of 35 who are going to occupy the property themselves will continue to pay 2% transfer tax.
• The government proposes to cancel the schenkingsvrijstelling(gift exemption) for owned properties as of 1 January 2024. This exemption of € 106,671 (in 2022) in gift tax, also known as jubelton, applies to donations to people between the ages of 18 and 40 who utilise those gifted amounts to purchase their own home. For these donations, the option to spread this over a period of 3 years is applicable: the part of the exemption unused in the first year can still be used in the following 2 years.
• The eigenwoningforfait ((notional) investment value of owner-occupied property) has been reduced. For homes with a WOZ (Valuation of Immovable Property Act) value of up to € 1,200,000, the percentage will be 0.35% in 2023. From € 1,200,000 the percentage will be 2.35%.
• As is standard practice, the rates for income tax are being tinkered with. These are the current and new rates:

  Box 1 Income Tax rates	2022	2023
  Income up to € 73,031	37,07%	36,93%
  Income over € 73,031	49,50%	49,50%

  In 2022, this limit was still € 69,399 The rates of the eigenwoningforfait and taxation determine the difference between the gross and the net monthly repayment sums for a mortgage.

• Also of importance for expats are the plans surrounding the so-called 30% ruling. This means that foreign employees can receive 30% of their salary tax-free under certain conditions, because they incur extra costs for housing, for example. From 2024, the government wants to apply the 30% ruling solely to salaries that adhere to the Top Income Standards Act, also known as the Balkenendenorm (Balkenende standard). This is currently set at € 216,000.
  There will be a transitional arrangement for employees for whom the 30% ruling has been applied for the last wage period of 2022. For them, the capping will only take effect from 1 January 2026. Employees who join the 30% ruling from 2023 will know in advance that the cap is being introduced. The transitional arrangements therefore do not apply to them.

Measures to combat the housing shortage

The government also wants to tackle the structural cause of the housing shortage. A considerable amount had already been disclosed on this matter. These are the main points of the budget documents:

• The government is taking back control of public housing and spatial planning. The Nationale Woon- en Bouwagenda (National Housing and Building Agenda) states that around 900,000 new homes are to be built by 2030. Together with provinces, municipalities, housing corporations and the construction sector, the government wants to realise this ambition, including the related infrastructure and transport options.
• Affordable housing is in high demand, but construction efforts in that regard are lagging behind. The government will therefore release € 100 million for the Woningbouwimpuls (Housing Impulse) starting in 2023, for 10 years. This extra money will be allotted to municipalities to get new homes built faster for many different target groups. In 2022, € 250 million was already allocated for this purpose. For investments in affordable housing almost € 11 billion has been made available.
• In 2023, 15,000 so-called flex and transformation homes are scheduled to be built. Flex homes are fully-fledged homes that are prefabricated in factories. As a result, they can be constructed relatively quickly. An additional € 380 million is available to accelerate temporary housing.
• The Netherlands central government Rijksvastgoedbedrijf (Central Government Real Estate Agency) is converting existing buildings, such as vacant offices and healthcare real estate, into temporary homes for local emergency accommodation seekers, such as residence permit holders and refugees from Ukraine.
• From 1 January 2023, the Biedlogboek (Bidding Log) will become mandatory for all estate agents, which should make the buying process fairer.

Status of measures

It is important to remember that everything that has been incorporated in the Budget Memorandum and the appendices are plans for the future. These plans have yet to be discussed in the House of Representatives and the Senate and – whether amended or not – approved before they can be converted into legislation. This discussion is called the ‘Algemene Politieke Beschouwingen’ (General Political Considerations). The entire process as it is completed every year is explained briefly on the website of the House of Representatives (Dutch language).

Sources

The following sources have been used for this blog, and offer a good starting point for readers looking to delve further into the matter:
• Belastingplan 2023 (2023 Tax plan)
• Miljoenennota 2023 (2023 Budget memorandum)