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Overview of Mortgage Changes in 2024 in The Netherlands

1 st February 2024

There are many things to consider when buying a house in The Netherlands. In this M/V Works Blog, we outline the most important regulatory changes that became effective in 2024 with focus on NHG, transfer tax and energy label matters.

This blog aims to make you aware of the possibilities that arise in the house-buying process, and provide valuable information for every homebuyer.

Dutch National Mortgage Guarantee (NHG)

When purchasing a house, you can choose to take out a mortgage that has a National Mortgage Guarantee included with it. Your mortgage is guaranteed by the Dutch  Homeownership Guarantee Fund, thus your interest rate and risk will be lower. Having a mortgage with NHG provides you with a safety net. If your personal circumstances change beyond your control (loss of job, end of relationship, becoming disabled to work, death of partner), then NHG can help you find a suitable solution. If your mortgage is in line with the NHG terms and conditions, and you have to sell the house because you are not able to meet the monthly payments, then NHG will cover the difference between the selling price and the remaining mortgage.

There are several benefits of taking out a mortgage backed up by NHG such as:

  • lower interest rate (depending on your lender) compared to no NHG backup
  • NHG fee can be deducted from your taxable income
  • you can take out a NHG backed up mortgage for: new-build property, existing property, but also for a refurbishment or a renovation project

As of 2024, there are some changes for the standards of NHG. From now on you can take out a mortgage with NHG, if the property you want to purchase does not cost more than €435,000. Next, if the energy efficiency is included in the mortgage, the maximum limit goes up to € 461,000. Subsequently, you can now switch your non NHG mortgage to an NHG backed up mortgage, as long as your mortgage is in line with the NHG conditions.

Property Transfer Tax

When buying a property, another thing that you will come across is the property transfer tax, in other words it is a transfer fee you pay when changing the house ownership from the seller's to you. The property transfer tax is 2% of the house price, but there are some exemptions. From 2024 you can benefit from the exemption of the transfer tax, if you are a first-time homebuyer, aged between 18-35 years, and the property price is up to € 510,000.

For example, if the house that you are buying costs 450,000, then you save € 9,000 from the property transfer tax exemption. If you are a second-time homebuyer (for your own use), then the 2% transfer tax applies. In all other cases (e.g. buy-to-let), a 10.4% transfer tax applies.

House Energy Label

An energy label in The Netherlands describes how energy efficient the house is. Energy label class can vary from A (very energy efficient) to G (very little energy efficient). Moreover, houses with class A have more specifications varying from A to A++++. It is important that the house you want to buy has a valid energy label registered by an energy adviser. Depending on the house energy label you can get an extra amount of mortgage. From 2024 these are the following numbers for each label presented in a table below. Houses with energy labels E,F,or G are treated as a standard, and no extra mortgage can be added.

Furthermore, if the house you are planning to buy, has an energy label B or higher, you can get a discount on the interest rate, the amount of discount depends on the lender you get your mortgage from.

Table 1. Additional mortgage depending on the house energy label

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If you want to make your house more energy efficient, you can get an extra amount of mortgage, depending on the current house energy label. In order to make your house more energy efficient you can invest in: solar panels, solar water heating, better insulation for roof, windows, and cavity walls, heat pumps and ventilation with heat recovery function. In most cases, the solutions listed above, usually results in a greater reduction in the energy bill compared to the increase in monthly mortgage costs. Below a table shows what is the maximum that you can additionally borrow to make your house more energy efficient.
*or good energy performance of at least 10 years

Table 2. Additional mortgage for increasing house energy efficiency 

Blog 1   table 2  (1)

This M/V Works Blog, provides general information, and it is not a financial advice. In order to find the best solution fitted to your specific situation, get in touch with our independent financial advisors at M/V Works. We will be assisting you throughout the whole duration of the mortgage process, and will make every effort to ensure that your mortgage has the best possible conditions tailored to your situation.

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