A new fundamental criterion for evaluating homes from 2021
In 2021, a new label will be assigned to houses during the assessment (taxation), reflecting the risks associated with the foundation, which can significantly affect the sale price of a large number of houses.
From July 2021, real estate appraisers will include a new indicator in their assessment report (taxatierapport) - a foundation risk assessment label, reminiscent of the existing energy efficiency rating scale, reports TV program De Monitor. The scale ranges from “A” (“no increased risk”) to “E” (“significantly increased risk”).
An appraisal report (taxation) is an obligatory stage in the purchase of any home with a mortgage. It is issued by a professional appraiser and is aimed at identifying the current market price of an object, taking into account the location, technical condition and the market situation itself. In most cases, the size of the mortgage issued cannot exceed 100% of the price set as a result of taxation.
What's behind this new label?
Due to drought in recent years, the groundwater table continues to drop. This causes the soil under the concrete foundation to dry out, causing the building to sink. Houses built on wooden piles are also under threat: when groundwater runs out, the piles dry out, are destroyed and also sink. According to experts, the total low water table threatens the foundations of about a million houses and other buildings in most of the Netherlands, and 250.000 buildings can be attributed to a high degree of risk.
The foundation risk assessment label will be based on 13 factors such as year of construction, altitude and water table, and will take into account the current condition of the foundation. The risk indicator will be determined on the basis of their objective data, and for an accurate study of the state of affairs, it will still be necessary to resort to construction expertise.
Please note that damage to the foundation of the house as a result of the impact of such a destructive factor as groundwater is not covered by insurance. Indeed, in such a situation, damage is caused by a process that lasts for many years, and not by a sudden emergency event, for example, a fire.
Among the side effects of the innovation, one should expect an increase in the cost and, possibly, the timing of the assessment (taxation) procedure. A negative or ambiguous assessment of the condition of the foundation can lead to a decrease in the market value of the house. In the context of the current state of the market, when the purchase price of houses in liquid locations goes significantly higher than the starting and, moreover, the cadastral value, a low estimate based on the results of taxation may require you to contribute more of your own funds to complete the transaction than you originally expected. As a result, people with savings will receive even more benefits.
What other challenges will home buyers and sellers face next year? We will keep you updated, subscribe to our news.
Publication Date: 27.10.2020
