The Dutch government limits mortgage borrowing capacity as of 2023.As the cost of living and energy rises, the Nibud (National Institute for Budget Information) is preparing its advice for the Dutch government to reduce the maximum mortgage amount consumers can borrow.

According to the Het Parool article, rising energy prices and living expenses reduce consumers' financial flexibility. This results in less borrowing capacity to avoid debt problems in the future.

The Nibud will submit the proposal regarding the lending requirements for 2023 on 1st October. Then, the Minister of Finances will inform the banks of the new lending criteria. Banks are not permitted to extend loans beyond the norm.

The Nibud research team is finalizing the proposal on maximum borrowing capacity and how it impacts other expenses consumers must pay, such as food, clothing, and energy bills.

Homebuyers can already borrow less money than in previous years. This year, the interest rate on a 20-year fixed-rate mortgage rose by 2.5 percent to nearly 4 percent.  Higher interest rates mean people can borrow significantly less than before, resulting in the rising housing prices slowing down.

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