Overview of planned changes for the housing market

In the Budget Memorandum the government presented its plans for 2021. We have listed the most important changes for you.

Differentiation of real estate transfer tax

The transfer tax on real estate will be differentiated. First-time buyers are exempted from transfer tax and those selling their property and buying a new home continue to pay 2%. A rate of 8% will apply to all other categories.

There will be three different rates:

It is proposed to introduce a one-off transfer tax exemption for first-time buyers in the housing market under the age of 35.
The current rate of 2% will only apply to natural persons who will be using the acquired property as their main residence.
All other acquisitions will be taxed at the higher general rate from 1 January 2021. The general rate will be increased to 8%. As a result, the rate will rise from 6% to 8%. This means that – in addition to the acquisition of non-residential properties, such as commercial properties – acquisitions of properties that will not be used, or will only be used temporarily, as the main residence will also be taxed at 8%. This includes, for example, the acquisition of a holiday home, a property bought by parents for their child and the acquisition of homes by non-natural persons, such as legal persons, for example private investors and housing associations.

Box 3

The capital gains tax in box 3 will be adjusted to reduce the tax burden on smaller assets in box 3 as of 2021. In addition, the tax rate in Box 3 will be increased to 31%.

Prevention of evictions

The government is in talks with landlord organisations – including Vastgoed Belang – to prevent evictions due to rent arrears as much as possible.

Impulse for housing construction

The government is focusing on more and faster housing development and making the built environment more sustainable through additional investments.

Rent reduction by housing associations

Tenants with a low income paying a high rent (in relation to their income) for a rental property through a housing association are entitled to a one-off rent reduction.

Reduction of landlord tax on social housing

In order to finance the compulsory rent reduction by housing associations for low-income tenants, the government is reducing the rate of the landlord tax as of 1 January 2021 from 0.562% in 2020 to 0.526% in 2021.

Legislative proposal for excessive borrowing

In the case of substantial interest holders who borrow more than €500,000 from their company, it is proposed to tax the excess as of 1 January 2023 as income from a substantial interest.

Source: Vastgoedbelang