The jubelton (the tax-free gift from parents towards buying a home) creates inequality on the housing market. You are a first-time buyer on the housing market. Perhaps you aren't looking for a place of your own just yet, but you are already having a look around. What prices! And they just keep rising. I can hear you thinking: ‘How will I ever manage this? Will I have to live with my parents forever?’
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Renting or buying
I don't think anyone wants to live at home with their parents their whole life. However lovely they are. But how do you take that first step onto the housing market?
Is renting the solution? At first it seems a cheaper alternative, but besides the fact that supply on this market is also very small, the monthly costs of a rental home quickly exceed those of an owner-occupied home. So that doesn't seem to be the solution for everyone either.
Can you afford the monthly costs of buying a home, but is the purchase itself the problem? We have to stay realistic: not everyone can turn to their parents for help financing their first home. Still, there are lots of parents who are financially able to give their child(ren) a substantial gift.
Gift, tax, exemption
If parents want to give their children a gift, they pay approx. 10% tax on it. Many parents are happy to give money to their children, but to the Belastingdienst (the Dutch tax authority)… Well, that's another story. To give first-time buyers a better chance on the housing market, the cabinet created the jubelton in 2013. This is a tax-free gift of up to €106,671 that parents may give their children so they can buy a home of their own. The jubelton is officially called the schenkingsvrijstelling eigen woning (the gift tax exemption for an owner-occupied home).
Equal opportunities
Thanks to this jubelton, first-time buyers not only have a better chance on the housing market, but can also overbid substantially on a home if they do have the money themselves. Of course, this hasn't been the only cause of today's high house prices, but it has certainly contributed.
With the abolition of the jubelton, first-time buyers should get an equal chance on the housing market, regardless of their financial background. In 2023, the gift tax exemption will be reduced to €27,231. This is the amount parents may give their child tax-free and that the child may spend freely. From 2024, parents will no longer be able to make any tax-free gift to their child at all for the purchase of a home.
One last chance to celebrate?
I think there are lots of first-time buyers who feel uneasy about this. Perhaps you, too, were counting on a gift like this from your parents? A hundred thousand euros, after all, is not an amount you ‘just’ save up. Let alone within a year! That's why I recommend making use of it while you still can. Even if it still feels far too grown-up to go looking for a home of your own to buy, your future self will be very glad you did!
At Gusto Casa, we always give our clients the following tips:
- Take a stroll through neighbourhoods that appeal to you, but also through neighbourhoods you don't know so well yet.
- Ask yourself a few questions now: ‘What do I really find important in a house? And what couldn't I do without?’
- Make an appointment with a financial adviser so that you know what you can spend and what that means for your monthly costs.
- Talk to several buying agents. Look for someone who appeals to you, understands exactly what you are looking for and knows everything about the market in which you want to buy a home.
As a young estate agency, we can put ourselves in your shoes all too well, so we're happy to think along with you. Would you like to drop by our office in Utrecht, with no obligation? Then feel free to get in touch with us!
