Thinking of buying a home in the Netherlands as an expat? Having recently purchased my dream home in the Netherlands, I have compiled some useful tips for those seeking to buy a home in the Netherlands as a foreigner, extra costs to consider, and key steps in the Dutch home purchasing process to be aware of. Firstly, the practicalities and then onto the fun of finding your dream home. Good luck or Veel succes!

LEGAL DISCLOSURE: The information in this blog post (“post”) is provided for general informational purposes only, and may not reflect the current law in your jurisdiction. No information contained in this post should be construed as legal advice nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting on the basis of any information included in, or accessible through, this post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a real estate/lawyer licensed in the appropriate licensing jurisdiction.

• Are you eligible to purchase property in the Netherlands?
• Factors to consider before buying a house in the Netherlands
• Extra costs associated with buying a house in the Netherlands
• Perfect Fit: Finding the right house
• Tips for finding an apartment or house in a competitive market
• Steps for buying a house in the Netherlands as an expat

Eligibility to buy an apartment or house in the Netherlands

The Netherlands is a densely populated country, making the housing market very competitive. Following the 2008 financial crisis, the housing market in the Netherlands fell considerably but since 2014 has been steadily rising and is now above pre-2008 prices. However, purchasing a property can be cheaper in the long term than renting.

To purchase property in the Netherlands you need either an EU or a Dutch residence permit. If you intend to get a mortgage, banks may be more likely to approve your mortgage if you have a permanent resident permit (only obtained after 5 years living in the Netherlands).

Editor’s note: To qualify for a mortgage in the Netherlands, you generally require a permanent (e.g. indefinite) contract or a note from your employer stating that your work intend to give you a permanent contract.

If you are a freelancer or entrepreneur, you will have a more difficult time buying a house or apartment as an expat as you will need to show paperwork showing your income from the previous three years. Having substantial savings can help significantly.  See your local lender for more information.

Factors to consider before buying a house in the Netherlands

What is your budget?

Currently, in the Netherlands, you can borrow up to 100% of the value of the property. However, you still need to be mindful of your own financial situation and ability to manage the mortgage repayments.

What is your financial situation?

Compile a detailed record of the following to understand which price range is right for you. Take into account:

• Monthly expenses (groceries, utilities, taxes, insurances, sport/exercise memberships)
• Loan repayments, credit card debts
• Unpredictable expenses (medical, travel, car/ bike damage, entertainment)

The real value of the house

In the Netherlands, the value of a property is determined by the Dutch government via a taxation inspection (taxatie). A taxatie is booked once an ‘offer of contract’ has been accepted and signed.

While the banks allow you to borrow 100% of the loan, this figure is determined by the taxatie assessment. For example, if the offer accepted is 300k and the taxatie assessment values the property at 250k then the bank will only loan you, (up to) 250k. You will then be required to pay the remaining 50k out of your savings.

Tip: Complete plenty of market research on similar properties sold in the area to get an idea of the sale price and possible taxatie.

Extra costs associated with buying a house in the Netherlands*

These will not be covered by your mortgage, so save accordingly!

• 2% tax on the purchase price
• Notary costs: Mortgage contract and transfer deed
• Generally, two documents will require signatures at the notary. One for the mortgage contract and one for the transfer deed. Expect to pay approximately 750€ per document.
• For expats without a good understanding of Dutch, an interpreter will need to be present at the notary signing to go through the paperwork with you. Approximate cost, 250€
• Mortgage broker (if choosing to use one)

Tip: Consider using a mortgage broker

Using a mortgage broker was the best decision we made in this process. We initially spoke to banks directly however found it challenging and time-consuming. If you don’t have a good understanding of Dutch or the spare time to visit multiple banks, then using a mortgage broker can be a good option.

Brokers generally charge a one-off fee (no trailing commissions) to find the right bank/mortgage for you. They also organise the taxatie inspection for you. Once the mortgage has been approved through a bank, you will then deal directly with that bank rather than the mortgage broker. Mortgage broker fees differ, however from our experience it ranges between 1000-2000€ on top of what the bank would charge.

Editor’s note: Consider NHG requirements

There is something called the NHG (Nationale Hypotheek Garantie). In the situation that you cannot repay your mortgage, this scheme ensures that you don’t have additional debt if you are forced to sell your house for a loss and cannot repay your mortgage. It also ensures that the bank gets repaid. Properties must cost less than 290,000 euros in 2019 to qualify for this scheme. You might get a lower interest rate in return although you will need to pay 1% of the mortgage value to apply. Ask your lender!

Perfect Fit: Finding the right house

Quality of Life in the neighbourhood

Once you know your budget – choose what property type and area is right for you and your lifestyle (within this budget!). Consider the property’s proximity to the city, beach, your work and entertainment destinations.

• Check the public transport available in the area and the distance of metro/bus and tram stops from your prospective home.
• Is there parking allocated or parking permits available?
• Is the neighbourhood bicycle friendly?
• Are there leisure/fitness centers located nearby?
• Consider the noise level of the neighbourhood? Are there busy roads, bars or construction?
• How is the lighting and safety of the neighbourhood?
• Which doctors, dentists, hospitals and police stations are in proximity.

Active VvE

The purpose of your purchase also needs to be considered. Will it be your home long term, short term, or an investment property? If the property is an apartment/townhouse with other houses on the land, check if it has an active VvE.

VvE, is the abbreviation for ‘Owners Association’. Once you purchase an apartment/townhouse you will become a member of the VvE (if there is active VvE), along with the other owners in the building. The VvE is used to help pay for maintenance of the building. It is also possible to organise group insurance on the whole building through the VvE rather than insurance on each individual apartment. Contributions are required to be made each month and dramatically vary in price between buildings. Elevators, garages and any electric doors within the property attract much higher monthly VvE contributions.

Check if the property has an active VVE as if it doesn’t, then it will substantially limit the number of lenders willing to approve your finance (most big banks won’t give you a loan if there is no VvE or VvE is inactive, as there is the risk of you not being able to repay the mortgage if there is a major repair bill). The monthly VvE contributions will also impact your budget.

Age of the property and energy ratings

Check the energy rating of the house. Older properties often have worse energy ratings. (Check for single pane windows!) This can significantly increase energy bills per quarter. These properties can be upgraded; however, this can require a substantial amount of work and money.

Editor’s note: You might be considering an older property. If the property is significantly old, ask about the foundation. Many older Dutch buildings (e.g. from the 1600s-1700s) have foundations that are rotting away and must be replaced in the not-so-distant future. This can be quite expensive to replace, even if you’re considering one of many apartments in a building.

If the building is older, it may be a Rijksmonument building, which means it is protected under Dutch law. Living in an older building is wonderful, however Rijksmonument laws may prohibit you in terms of making certain kinds of changes (e.g. replacing single pane frames with more energy efficient frames) within the home as well as to the exterior of the building. Any changes may require assessments by relevant parties as well as expensive consultants to find the correct materials.

Is the land included?

Check whether it is a ground lease or if the land is part of the sale. In some cases, you may need to pay extra to receive the property (e.g. backyard) around your property. An advertisement should state this information on Funda or Pararuis.

Tips for finding an apartment or house in a competitive market

Some properties have scheduled viewings, however, the real estate market in the Netherlands is very fast so try and book your own viewing appointments. Booking during the day is the best light to see the property in. If you are really interested, then you can organise multiple visits.

Take detailed notes

• Try not to view too many properties in one day.
• Ask why the previous owner is selling and how quickly they need to sell.
• Ask any questions you have, and take your time.
• How many others are interested in the property?
• Build a relationship with the seller so that you stand out.

Steps for buying a house in the Netherlands

Put in an Offer

Found your dream home? Time to put in an offer! When putting in an offer you are required to sign a ‘contract of offer’. I recommend adding a clause to the ‘contract of offer’ stating the following (just in case!): ‘Offer is subject to building inspection and personal finance.’ You have no idea what might be found during the building inspection.

Finalize your finances

Finalise your finance with a bank or mortgage broker. A 6-week minimum settlement period will allow you time to organise your finances, a building inspection and the taxatie. If there isn’t a long enough settlement time and the contract lapses, you are subject to pay a fee and you may not get the property.

Building Inspection

Once the offer is accepted you can then book the building inspection. This can take upwards of 10 days to organise the inspection and receive the report. Once again ensure you have enough time in the contract to organise this.

We paid approximately 250€ for an apartment for a building inspection. This figure depends on the size of the property. Foundation inspections can increase this cost.

Book a taxatie (taxation inspection)

A mortgage broker can organise this or you can do it independently. The report may take upward of 10 days.

Choose a notary.

The final inspection of the house is completed on the day of signing, so it is convenient to choose a notary that is close to the purchase property. Flexibility in working hours helps when scheduling property viewings, assessments and meetings with banks and mortgage brokers, however some are open after hours.

We have been so happy with our decision to purchase property in the Netherlands and I wish you good luck in finding your dream home.

Anything you’d add about buying a house as an expat in the Netherlands?

• Feeling not ready to purchase a house? Read these tips for renting as an expat in the Netherlands!