The jubelton: the first time I heard this word was at an information afternoon held by the accountant. I was sitting next to my father in the room, and most people there were his age. All of them people with their own business. Everyone listened attentively, and most people thought it was quite a nice concept. Giving €100,000 tax-free to your children to buy a home. Lots of examples were also given of family bank mortgages, borrowing from your BV (private limited company) and other tax tricks. I had just bought a house and looked at Dad hopefully… But no such luck.
The jubelton creates inequality
The jubelton was intended to get the housing market, which was still fairly stuck, moving a bit more. The increase in the tax-free gift created more purchasing power and gave the housing market a boost. A nice tool to stimulate the housing market. But the housing market is now overheated. The housing market doesn't need a boost anymore. We see lots of first-time buyers coming through here who get a tax-free gift from their parents, uncles, aunts, grandpas & grandmas. Super nice in this market, of course. It also means your home won't so easily end up under water after a small setback. You have to overbid. Borrowing capacity is large, but not as large as you might like. That hundred grand is a great stepping stone, of course. But if your family can't spare it, which is quite likely of course, it becomes even harder to compete with the first-time buyers who do get this amount. When the option of tax-free giving was introduced, there was a logic behind it. It was a way to transfer wealth from old to young. Young homeowners' debts could then be reduced, and new money came into the housing market to counter further falls. Now it has a price-inflating effect and creates more inequality between first-time buyers. There will always be inequality, but legislation shouldn't promote it.
Making the housing market more accessible for young people
You can see that over the past year the group of investors has shrunk and the group of first-time buyers who bought has grown. Of course, that's also due to the abolition of transfer tax for first-time buyers. Until 1 April 2021 it didn't matter how expensive the house was; after 1 April 2021 the exemption applies to homes with a purchase price of up to €400,000. Lots of parents currently have a large surplus value on their home. They're cashing this in to help their own children. They use family bank mortgages, senior mortgages and simply increasing their own mortgage to give money to their children. The price rise in the first quarter was enormous. The 2% was effectively added straight onto the offer. In the price trend from quarter 3, when the transfer tax plans were announced, you can see prices rise sharply. This table is based on the moment a home is listed on and taken off Funda.
What will abolishing the jubelton do to the housing market?
Are you thinking about selling your home? Then it's a good idea to keep a close eye on the rules around the tax-free gift. On the one hand, the government wants to encourage first-time buyers, and it does so with this scheme. On the other hand, the government wants to get rid of this scheme. Abolishing the tax-free gift will have a big impact on the housing market in Utrecht. A lot of capital will disappear, and with it prices will also fall a bit, or at least rise less sharply. Do you want to sell your home now and make use of the capital in the market? I say do it!
