How is the (WOZ) value of a house determined?
Dutch municipalities have to value real estate in accordance with the guidelines laid down in the Wet waardering onroerende zaken and its implementing orders.
Municipalities constantly list and analyse the selling prices of all dwellings sold within their boundaries and obtain all data on rent. They also compare the characteristics of the real estate objects with what they have specified about them in their own registers. The WOZ value is then calculated through a computer model (model-based valuation). The value is then verified by a surveyor and adjusted if needed. Next the definitive WOZ is determined and implemented.
Municipalities have to value all real estate, including land and real estate under construction. The valuation is based on the situation on 1 January 2012 (situation date). The value on 1 January 2011 is taken into account, which is the reference date. The municipality does not determine the WOZ value of a building constructed, renovated or demolished in 2011 according to the situation on 1 January 2012, but according to the value on 1 January 2011.
Construction of a dwelling is started in February 2011. It was completed by 1 January 2012 and the new residents have moved in. The municipality determines the value based on the last situation. It also looks at the selling prices of comparable dwellings on 1 January 2011. And although this particular dwelling did not yet exist then, its WOZ value is determined as if it did.
The WOZ value of dwellings must be its commercial value. That is, the amount the dwelling would be sold for on the reference date. The situation taken is that the dwelling sold is unoccupied and ready to move into, without such complications as tenants or ground lease.
Rise in (WOZ) value
Although developments in the housing market between 1 January 2010 and 1 January 2011 show that the average house price has come down, it may be the case that the WOZ value of a dwelling has increased. There can be several causes. Perhaps a renovation was completed in 2011 or an additional piece of land bought. Municipalities have also checked though building applications, maps from the land register offices, areal photos, sales information and cycloramas. The value may have increased based on these checks.