The Dutch government has engineered a tax reform so clever that it might accidentally make housing even more expensive. Starting January 1, 2028, the new Box 3 (wealth tax) system will tax actual investment returns at 36%, including unrealized capital gains. Meanwhile, your primary residence remains safely tucked away in Box 1, where capital appreciation stays completely tax-free. The result? A massive incentive to pour every spare euro into bricks and mortar, potentially inflating an already overheated housing market.
This isn’t speculation, it’s already happening. Across the Netherlands, investors are liquidating stock portfolios and upgrading to larger homes, not because they need the space, but because the tax math makes it irrational to do anything else.
The Box 3 Tax Shift: From Fiction to Brutal Reality
Until 2028, Box 3 taxes a fictional return on your wealth. The Belastingdienst (Tax Authority) assumes you earn a certain percentage, and you pay 32% tax on that assumed amount. It’s simple, predictable, and largely disconnected from reality.
The new system changes everything. From 2028 onward, you’ll pay 36% tax on your actual returns, dividends, interest, and crucially, capital gains. If your €100,000 stock portfolio grows to €150,000, you owe tax on that €50,000 gain, even if you never sell a single share.
Here’s where it gets painful: losses from before 2028 won’t count. Many investors face a scenario where their portfolio crashes in 2027, recovers in 2028, and they get taxed on the recovery as if the crash never happened. One calculation shows a €100,000 portfolio that drops to €50,000 then recovers to €100,000 could trigger €17,352 in taxes, on zero net gain.
The Great Wealth Migration: From Stocks to Stone
Faced with this tax regime, rational actors do what rational actors do: they reallocate. The research shows a clear pattern emerging among Dutch investors.
Many are cashing out their aandelen (stocks) and ETF’s to upgrade their primary residence. One investor bluntly stated they’re selling all their investments to buy a more expensive house. Another couple moved from a 100m² home to one over 200m², explicitly citing the tax advantages. The logic is simple: capital gains in your home are tax-free, while capital gains in your investment account face a 36% haircut.
This creates a powerful feedback loop. As more people pour money into owner-occupied housing, demand increases. Increased demand pushes prices up. Rising prices attract more investors fleeing Box 3 taxation. The cycle continues.
The impact of new Box 3 rules on FIRE movement and investment behavior has been severe enough that some Dutch savers are considering moving their fiscal residence abroad entirely.
Two Competing Forces: Supply vs. Demand
The housing market effects aren’t one-directional. The Box 3 reform creates two opposing forces:
Force 1: Rental Supply Increases
Verhuurde woningen (rental properties) face the same 36% tax on capital gains, plus additional regulatory burdens like the Wet betaalbare huur (Affordable Rent Act). The result? A massive sell-off. In 2025 alone, over 42,000 huurwoningen (rental homes) were sold to owner-occupants, a 14% increase from 2024. Private landlords purchased 98% fewer properties than three years earlier.
This “uitpondgolf” (sell-off wave) concentrated in Amsterdam, Den Haag, Rotterdam, and Utrecht, temporarily increases supply for buyers.
Force 2: Demand Explosion
Simultaneously, wealth shifts from Box 3 investments into owner-occupied homes. Investors aren’t just buying houses to live in, they’re using them as tax-efficient wealth storage vehicles. One commenter calculated that upgrading from a €1 million home to a €1.3 million home with a €550,000 interest-only hypotheek (mortgage) could shelter significant wealth from Box 3 taxation.
The demand effect likely outweighs the supply effect because:
– The 42,000 sold rentals represent a one-time shift, peaking in mid-2026
– The wealth migration from Box 3 is ongoing and affects a much larger capital base
– Rental properties sold in the uitpondgolf often end up back on the market as owner-occupied homes, not increasing net housing stock
The Interest-Only Mortgage Loophole
Here’s where Dutch tax planning gets creative. Under the new rules, schulden (debts) are deductible from your Box 3 wealth. This creates an opportunity: take out an interest-only hypotheek on your primary residence, and you can shelter wealth while your home appreciates tax-free.
One investor explained their strategy: they have a €1 million home with €250,000 in debt. By upgrading to a €1.3 million home, they can take €550,000 in interest-only financing, reducing their taxable Box 3 wealth while capturing tax-free appreciation.
This using mortgage debt to reduce taxable wealth under new Box 3 system strategy is risky, debt is debt, and interest rates can rise, but the tax savings make it attractive for high-net-worth individuals.
The “Uitpondgolf” Reality Check
The numbers from the uitpondgolf are stark. Nearly 60% of all rental property sales occurred in Noord- and Zuid-Holland. Amsterdam, Den Haag, Rotterdam, Utrecht, and Haarlem lead in absolute numbers. Relative to their size, Diemen, Amstelveen, and Wassenaar show the highest sell-off rates.
Why? High huurprijzen (rental prices) combined with strong koopprijzen (purchase prices) make selling extremely attractive for landlords. The Wet betaalbare huur expanded regulated rent controls to properties up to 186 WWS-punten (a housing quality score), squeezing rental yields further.
The timing is critical. Many temporary huurcontracten (rental contracts) expire by June 30, 2026, creating a final surge of sales. After that, the uitpondgolf will likely fade, removing the temporary supply boost.
Will Prices Actually Rise? The Math Suggests Yes
While the uitpondgolf provides short-term relief, the structural incentives point to price inflation:
- Capital Reallocation: Wealth estimated in the tens of billions will shift from financial assets to real estate
- First-Time Buyer Squeeze: Upgraders with significant Box 3 wealth will outbid first-time buyers
- Supply Constraint: The Netherlands already faces a housing shortage of 300,000+ units
- Interest Rate Context: Even with current rates, the tax arbitrage makes borrowing attractive
The details on the 2028 Box 3 reform and taxation of unrealized gains show that the 36% rate applies to all asset growth, making the 0% rate on primary residences look like a screaming bargain.
What This Means for Different Groups
For First-Time Buyers (Starters)
You’re caught in a perfect storm. The uitpondgolf might offer slightly more supply, but you’re competing against investors who can overbiden (overbid) using tax-free capital gains from their current homes. The advice remains: get on the ladder any way you can, even if it means buying in a less popular gemeente (municipality).
For Homeowners with Overwaarde (Equity)
Your home has become a tax shelter. Using your overwaarde to upgrade makes financial sense, but consider whether you actually need the space. Don’t let the tax tail wag the lifestyle dog.
For Investors
The math is clear: rental properties face a 36% tax on capital gains plus regulatory headaches. Your primary residence offers 0% tax. Many investors are choosing to maximize their eigen woning (own home) and minimize their Box 3 exposure.
For Renters
The uitpondgolf means fewer rental properties and potentially higher rents for remaining units. If you can buy, the numbers increasingly favor ownership over renting.
The International Dimension
The Netherlands is becoming an outlier. No other developed economy taxes unrealized capital gains at 36%. Critics call it “the dumbest policy on earth”, warning it will damage the Netherlands’ vestigingsklimaat (business climate) and ability to attract talent.
The broader threat of Box 3 to long-term financial independence goals has many high-earning expats reconsidering their stay. Why build wealth in a system that penalizes investment?
Strategic Responses Already Emerging
Savvy investors aren’t waiting for 2028. Strategies being implemented now include:
- Early Liquidation: Selling winning positions before 2028 to lock in lower tax rates
- Upgrading Homes: Moving wealth from Box 3 to Box 1 through housing
- Debt Optimization: Using interest-only mortgages to maximize deductible debt
- BV Structures: Moving investments into a Besloten Vennootschap (private limited company) to access Box 2 taxation instead
The how forming a BV may become a strategic response to new Box 3 rules option is complex and expensive, but for wealth over €500,000, it may be cheaper than paying 36% on unrealized gains.
Conclusion: The Inflation is Coming
Will the new Box 3 rules inflate housing prices? The evidence points to yes, with caveats.
The uitpondgolf provides a temporary supply boost that masks the underlying demand shift. But this is a one-time effect that will fade by late 2026. Meanwhile, the structural incentive to use owner-occupied housing as a tax shelter will persist for decades.
The Dutch government likely didn’t intend to create a housing price inflation mechanism. The goal was “fair taxation of actual returns.” But in tax policy, as in physics, every action has an equal and opposite reaction. By punishing financial investment while rewarding housing investment, they’ve created a powerful economic force that will push prices higher.
For anyone navigating this landscape, the key is to understand that your home is no longer just a place to live, it’s become the most tax-efficient investment vehicle in the Netherlands. Whether that’s good for society is another question entirely.
The comparison of pension vs. regular investing under looming Box 3 changes suggests that even traditional retirement planning needs rethinking in this new reality.
Actionable Steps:
– If you own a home, calculate your overwaarde and consider if upgrading makes sense for your situation
– If you rent and can afford to buy, the tax advantages have never been stronger
– If you have significant Box 3 wealth, consult a financial advisor about reallocation strategies before 2028
– Sign petitions and contact your representatives, policy changes are still possible as implementation challenges mount
The Dutch housing market was already complex. The new Box 3 rules just made it more interesting, and potentially more expensive, for everyone.
