Transfer Tax is tax payable when becoming the legal or economic owner of a property, be it a house with a garden, an apartment, shed or garage, shop or office.
The basis for the calculation of the tax to be paid is the purchase price of the property. Last summer the Dutch Government decided to reduce the transfer tax from 6% to 2% for houses and apartments. Although this was a temporary measure
extending until 1st July of 2012, it has now been extended for an unlimited period.
Consumer confidence is still low and people’s faith in the housing market and the economy may be even lower. A lot of people are worried about losing their jobs and this is delaying their decision concerning whether and/or when to buy a new house. Their understandable anxiety is that it might be difficult to sell their old house. This has meant that the train of buying and selling has gradually ground to a halt. The Government now wants to give the housing market a boost, since a stalled housing market has a disastrous effect on both employment and on the economy generally. Many people earn their daily living in the real estate market: real estate agents, mortgage brokers and bankers, builders, moving companies, painters, kitchen and bathroom manufacturers etc. So a boost to the housing market means a boost for the entire Dutch economy.
If, as a seller, you need to move house (perhaps because of job imperatives), and are concerned about the possible difficulties in selling, you could choose to rent out your current home whilst waiting for the property market to improve (though you would need permission from your mortgage bank to do this). Clearly the last thing you want to face right now is an empty property and so having to pay two mortgages.
