Annually, there are changes in the regulations regarding buying a house. We’ve listed three topics we encounter daily.
NHG
When a property is no more expensive than €355,000, as a first-time buyer, you can opt for a mortgage with National Mortgage Guarantee (NHG). This NHG ensures that you receive a mortgage in line with your income and that there’s a financial safety net in place should there be unexpected changes in your life, causing you not to afford your mortgage payments. An additional benefit of this NHG is that the interest rate for this type of mortgage is often lower than a standard mortgage.
The limit for an NHG mortgage will increase to a maximum of €405,000 in 2023.
First-Time Buyer Exemption
When you, as a first-time buyer, wish to purchase a property, there’s a chance you won’t owe any transfer tax. For this, you must meet several conditions:
- You are between 18 and 35 years old;
- The property you purchase is no more expensive than €400,000;
- You plan to live in the house for an extended period;
- This is the first time you’re using the first-time buyer exemption.
It’s also possible that you already own a property. If you meet the conditions above, there’s still a chance you might qualify for the first-time buyer exemption.
The limit for a first-time buyer exemption will increase to a maximum of €440,000 in 2023.
Gifting to a child as a parent
As a parent, you’re allowed to gift a certain amount to your child tax-free each year. In 2022, this amounted to a maximum of €5,677 per child. This rule also applies to foster and stepchildren. The child’s age doesn’t matter in this case.
Instead of this amount, you also have the option to gift your child a one-time higher amount tax-free. However, this gift can only be used for the following purposes:
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- A gift where the child decides how it’s spent. For this gift, there’s a maximum amount of €27,231.
- A gift intended to finance an expensive education. A maximum gift of €56,724 applies here.
- A gift intended for purchasing a property. For this gift, a maximum of €106,671 is allowed. This gift is also known as the ‘jubelton’ or ‘jubilation ton’.
This is a gift that replaces the standard tax-free gift of €5,677, so it cannot be considered an additional gift.
From 2023, the tax-free donation limit for financing a property will be reduced to a maximum of €28,947. From 2024, this arrangement will be abolished entirely.
Are you considering buying a property for your studying child? We have listed the 10 most frequently asked questions with answers for you here.
Note: what you read in this blog is merely a summary per topic. If you’d like to know more about the full regulations, you can contact us.
Menno Grandia
NVM buyer’s agent