DNB wants to reduce tax benefits for homebuyers. What does that mean for you?

What is DNB proposing?

DNB wants to bring the tax treatment of renting and owning closer together. It points to mortgage interest tax relief and the low notional rental value added to taxable income for owner-occupied homes, known as the eigenwoningforfait. According to DNB, these advantages encourage demand for homes and borrowing. Reducing them could weaken those incentives. [1, pp. 2–3]

The bank also calls for more housebuilding. It says this requires, among other things, a more attractive investment climate, greater policy certainty and action on shortages of building land and capacity. A single measure is not enough. [1, p. 3]

A lower purchase price does not automatically mean lower monthly costs

For a buyer, the price of a home and the cost of financing it are different things. A smaller tax benefit could mean higher net costs on the same mortgage. If you also end up paying less for the property, however, you may need a smaller loan.

Which effect matters more for you depends on the final rules, your income, your mortgage and the purchase price. The DNB paper does not provide an individual answer. Less upward pressure on prices is also no guarantee that the home you want will become cheaper.

Our practical takeaway for buyers: ask to see both gross and net monthly mortgage costs when assessing a purchase. Discuss with your mortgage adviser how much your budget depends on tax benefits and how much room you would have if costs changed.

Being able to borrow more does not automatically give you an advantage

DNB opposes relaxing lending standards: when housing supply is limited, extra borrowing capacity mainly increases pressure on prices and adds risk. It also recognises that tighter standards can make things harder for first-time buyers. [1, p. 3]

Suppose you and other buyers can all borrow more while bidding on the same home. Your additional budget is not an advantage unique to you. You can spend more, but your competitors may be able to do the same.

Allow for maintenance, energy improvements, any homeowners’ association (VvE) fees and the savings buffer you want to retain after buying. Your maximum mortgage does not automatically tell you how much of that borrowing capacity you should use.

Should you buy now or wait?

This paper alone is not a sound reason to bring a purchase forward or put it off. It does not predict when the home you want will become cheaper. Waiting also has a cost: your current housing expenses continue, and your housing needs may change.

You can use the debate to assess a purchase more carefully. Will the home suit you for several years? Can you afford the costs while leaving room for setbacks? And is your bid supported by comparable sales, or mainly driven by fear of missing out?

SlimBieden can help with that last question by providing property insights and different bidding strategies. Discuss mortgage affordability with your adviser. That way, you can combine a well-founded bid with a budget you will still feel comfortable with after receiving the keys.