The owners of more than 4.5 million owner-occupied Dutch homes will receive the annual WOZ letter on the mat these days. The good news for many is that their homes are likely to be more highly valued. The bad news: the associated taxes are also going up.
Anyone who believes that the specified WOZ value is not justified can file an objection. You can do this yourself, or through a specialized interception agency. With slogans like “Is the tax and customs office gnawing at your house too?” and “Save tax money? Devalue your WOZ!” These organizations try to entice citizens to use their services.
This is unfavorable to municipalities. Not only do they lose out on taxes with a reduced WOZ value, but they also have to pay legal costs if the mediation is successful. Through a series of measures, State Secretary Marnix van Rij (Tax and Excise Administration, CDA) wants to restrict the freedom of movement of these objection agencies.
Will objection be more difficult in the future? And how is the WOZ value determined at all? Four questions about the value of WOZ.
1 What is the WOZ value and how is it determined?
The WOZ value determines how much money a home is worth – the abbreviation WOZ comes from the Real Estate Valuation Act. In the first two months of the year, municipalities use an appraisal to determine home values in their area. Appraisers do not visit properties, but use data that shows, for example, the size of a house or the year it was built. They also examine the amounts for which neighborhood homes have been sold. Not all of this data is public, which can make it difficult for owners to verify the data.
It was a WOZ value this year an average of 17% higher over the previous year, according to ratings room numbers. This contrasts with the decline in home prices themselves: 6.4 percent year-on-year in January. This is because there was a one-year delay in the evaluation. The current WOZ value is based on the value of the home on January 1, 2022. Only in next year’s letter will homeowners see home prices fall again.
Governments at various levels use WOZ to determine the amount of taxes. For example, citizens must pay property tax (OZB) to municipalities and water system levy to water boards. The Tax and Customs Administration uses WOZ for income tax, corporate tax, and inheritance tax, among other things. The following applies: the higher the value of the WOZ, the more taxes citizens have to pay.
2 What if I think my WOZ value is rated too high?
After that you can file a justified objection within six weeks. Citizens can request municipal evaluation reports and compare them with other self-collected numbers showing that the set value is very high. With a WOZ value counter, for example, you can see what home prices are in the area that’s appraised. And at the cadastre, you can ask for similar home sales amounts for a fee.
There are also many interception agencies to get you out of this business. These organizations often operate on the basis of There is no treatment without payIf the objection is rejected, do not pay anything. If good foundations are declared, the municipality must reduce the value of the WOZ and pay legal fees to the mediation agency. The objector pays nothing.
Anyone who contacts an agency and successfully objects, says Duncan Ward, devalues their WOZ by an average of €35,000. Ward is the founder of Fair WOZ (30 employees, turnover of €5 million in 2022). He is also a spokesperson for the WOZ Advisory Firms Sector Association (VRLB), which has nine affiliate agencies with almost the entire brokerage market behind them. Last year, the total reduction by brokers amounted to 1.2 billion euros.
Read also: Selling a home is not as easy for Realtors as it was a year ago
3 What exactly does van Rigg want to change and why?
This system costs the municipalities a lot of (public) money and puts pressure on the implementing organizations and the judiciary. In 2021, the municipalities paid 18 million euros litigation costs. Mediation agencies file about 100,000 objections each year, just under half of the total. About 35 percent of this was honored.
Ward expects the number of interceptions to rise sharply this year. In the first two months of this year alone, the association sent as many interceptions as the annual average. “A lot of people don’t understand why their WOZ is so high and think instead of filing an objection,” says Ward. We also see that more citizens are realizing the financial importance of objection in this time of inflation.
Foreign Minister Van Rijk wants measures taken. He wants to cut the costs of procedures and pass them on to the citizens themselves, rather than to intermediary agencies. A spokesperson for the department said the department is also investigating the feasibility of a number of other measures. For example, not paying the allowance for legal costs at all when the WOZ depreciates slightly, and making the “informal” WOZ process mandatory. In addition, municipalities must be able to contact citizens directly in order to reach an agreement.
4 Is filing an objection more difficult now?
Probably not, Ward of Fair WOZ thinks. Citizens can still appeal themselves. “Some of the appeals agencies will no doubt disappear, but they are just the least regulated,” he says. He is not afraid for his own company, but Ward is afraid that the citizens will receive less services.
“Successful appeals would certainly become more difficult if the use of an agency was discouraged,” Ward said. Mediators will know better what arguments to put forward. They also say they have greater access to other rating systems and data.
Is this correct? Scientific Research and Documentation Center (WODC) concluded two years ago that intermediary companies Not more effective Objections from the citizens themselves: The percentage of honored visits was close. “In relatively easy cases, people call themselves. For example, when the roof of a house clearly doesn’t match the appraisal report,” says Ward. “We get the most specialized cases, which are hard to solve on your own.”
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