Changes in the Amsterdam Housing Market in 2022

The end of the year is in sight! The housing market has seen tremendous growth over the past year. Home prices have risen significantly, including in Amsterdam. In just one year, prices per square meter have 17%! Partly due to this increase, we can expect a number of changes in the housing market in 2022. We’ll take a closer look at these changes and what they mean for you.

1. Owner-occupancy requirement in Amsterdam

Starting January 1, 2021, municipalities will be able to implement their own rules regarding buyout protection. The City of Amsterdam wants to start this as soon as possible. It plans to impose an owner-occupancy requirement for homes with a WOZ value of up to €512,000. This requirement applies for the first four years after the home is purchased. The owner-occupancy requirement in Amsterdam is aimed at investors and is intended to give home seekers more opportunities. Permits to rent out the property after the fact will only be granted in exceptional cases.

2. Reduced mortgage interest deduction effective January 1

Effective January 1, 2022, the maximum mortgage interest deduction will be reduced from 43% to 40%. However, this does not apply to everyone, but only to those with annual incomes exceeding €69,398.

3. NHG increased from €325,000 to €355,000

The National Mortgage Guarantee (NHG) will increase from €325,000 to €355,000 in 2022. A mortgage with NHG is intended to reduce the financial risks for buyers. The reason for the increase is the sharp rise in home prices over the past year. It will also become cheaper to take out an NHG mortgage, with the rate dropping from 0.70% to 0.60%.

4. Changes to the transfer tax exemption

Starting this year, buyers under the age of 35 no longer have to pay transfer tax when purchasing their first home. Buyers over the age of 35 who will be living in the home themselves pay 2%. Investors pay 8%. As of January 1, the transfer tax will become even more equitable. If buyers are forced to cancel the purchase due to unforeseen circumstances, the government will ensure that they do not automatically pay the 8% rate prior to the transfer.

Starting in January 2022, housing associations and property developers will no longer be required to pay the 8% transfer tax on VoV homes. These are homes sold by housing associations and property developers at a significantly reduced price, subject to certain conditions. VoV homes are sold to first-time homebuyers or people with lower incomes. The aim of this measure is to keep these homes affordable for private buyers.

5. The standard home ownership allowance will decrease in 2022

Starting in 2022, the standard deduction for owner-occupied homes valued at up to €1,110,000 will decrease from 0.50% to 0.45%. This means that homeowners will be able to deduct more mortgage interest from their taxes.

6. These are the trends Amsterdam at Home expects to see in 2022

Based on the trends we’ve seen in recent years, we expect home prices to rise by 10% in 2022. We also believe the housing shortage will worsen. In 2021, there were already fewer transactions than in 2020. We expect the number of transactions to be even lower in 2022. The market is at a standstill. People want to move, but they cannot find an affordable home that meets their needs. For this reason, fewer homes are being listed for sale.