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For many years, Denmark has used property assessments as the basis for setting property taxes. However, these assessments were criticized for being outdated and inaccurate. As a result, the government has decided to conduct a comprehensive review of the property assessment system.
New property assessments came into effect on October 1, 2021 and are based on several factors, including the location, size and condition of the property. The goal is to create fairer and more accurate assessments that better reflect the actual value of the home.
Again in 2024, property assessments will be updated. For the majority of homeowners, the newly published property valuations will typically exceed the most recent valuation, as house prices have generally increased since then.
It only takes 15 minutes to try TaxHelper and you'll get an average of DKK 2,704 extra back in tax
At the same time, you only pay if you get a tax saving.
Impact for home buyers:
For home buyers, the new property valuations can have both advantages and disadvantages. A more accurate property valuation gives you a better idea of what you can expect to pay for a property. This can help you make decisions and avoid surprises later in the process.
On the other hand, the new assessments may also result in higher property taxes for some homeowners if their properties are assessed to have increased in value. This is something to consider when planning your home purchase and budget.
Impact on home sellers:
If you're in the process of selling your home, the new property valuations may affect your selling price. If your property has been assessed to have increased in value, you may be able to sell it for a higher price. This can be beneficial for sellers as it can give them a financial gain.
On the other hand, the new assessments can also lead to higher property taxes for you and therefore also for a potential buyer. Especially since the potential buyer doesn't get a tax rebate and may therefore end up paying higher property taxes than you do today. You still have the option to sell before December 31, 2023 without the new owner paying the potentially higher taxes.
Many people wonder whether it is advantageous to buy a home before or after January 1, 2024 before the new property valuations come into effect.
It is expected that property valuations in the larger urban areas and their surroundings will experience a significant increase. This is especially true in and around the Greater Copenhagen area, both for houses and condominiums. At this point in time, there is no certainty as to how the new property valuations will affect the housing market.
1. Understand the new assessments:
Start by thoroughly familiarizing yourself with how the new property assessments work. This includes learning about the criteria used to set the assessment and how the new assessment may affect property taxes.
2. Budget planning:
The new property assessments can lead to changes in property taxes for different properties. This can significantly affect your monthly budget. Make sure to take any changes in property taxes into account when setting your budget for your home purchase.
3. Find advice:
You may want to consult with a tax expert or real estate agent to understand how the new assessments affect you personally.
4. Plan your purchase or sale carefully:
If you are planning to buy or sell a home, it may be beneficial to do so before the new valuations come into effect to avoid any surprises.
5. Assessing investment potential:
If you're looking at your home as an investment, consider how the new property valuations affect its potential appreciation over time.
After January 1, 2024, it's important to continue to monitor property valuations and their impact on your finances.
In TaxHelper, we help you find the deductions you're entitled to. You answer a few simple questions that take just 15 minutes to complete.
Then we report the deductions, and you get an extra DKK 2,704 back in tax. At the same time, you only pay if you get a tax saving.
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