Buying a house in the Netherlands

No restrictions are placed on foreigners for buying property in the Netherlands, but there are some quirks of the Dutch housing market you should know of before buying a home.

Should you buy…

Whether you’ve just moved to the Netherlands or are already settled, you may want to consider the benefits of buying a home.

dichtbevolktAlong with many other countries, the housing market in the Netherlands has been in flux since the 2008 financial crisis ended a long period of rising property prices. The country is densely populated with a growing population, so competition for appealing properties in certain areas can be fierce. Almost 60 percent of Dutch people own their own home, and apartments or high-density family housing are common.

…or should you rent?

The Netherlands has a high proportion of social housing and rent controlled housing. Both are often restricted to low-income renters, which can make finding a property harder. There are tax benefits for home owners and mortgage costs are often lower than rent, however as the transaction costs of buying a house are around 6 percent and the property market is in flux, it is recommended you rent if you are new to an area or planning a stay of three years or less.

Are foreigners allowed to buy property?

Of course! The Netherlands does not place any restrictions on the purchase of property by foreigners, whether resident or non-resident.

Finding a property to buy

As in most countries, you can find property listings online and in local newspapers and free property papers. Using a real estate agent is very common in the Netherlands, and is advisable, particularly for those who are new to the country or are not fluent in Dutch.

Dutch estate agents are called makelaar. It’s common to have both a buyer’s agent and a seller’s agent, and each will have different roles in the transaction – and have to be paid separately.

Advantages and disadvantages of using a Dutch estate agent

makelaar

  • Expect to sign a contract with your agent – these are often exclusive.
  • This means you may be charged for the agent’s fee even if you find a property yourself or decide not to buy.
  • Fees are typically 1–2 percent of the property purchase price.
  • Agents perform the search and initial screening for you.
  • The agent should be only working for you, not for the seller.
  • Agents may have insider knowledge about the market in a particular area.
  • Agents may be able to advise on peripherals, such as neighbourhoods, schools and public transport.
  • Agent may be able to translate for you.
  • Agents can handle negotiations, notary meetings and arrange the sale contract.
  • Agents should perform property checks (not a structural survey) regarding ownership, land registry and apartment cooperative contracts – this is important as it is possible to buy a property without then having the right to live in it.

Prices

Like anywhere else, the 3 most important things that determine the price of a house are location, location and location. However, average prices for specific types of houses are given in the following overview.

Type of housing Purchase price (x1000)    Mortgage per month/net
(indication, incl. tax refund)
studio apartement €120 –    €160 €375 –    €475
Two-bedroom apartment €140 –    €200 €425 –    €525
Three-bedroom terraced house €170 –    €250 €450 –    €575
Semi-detached house €220 –    €500 €625 –    €1075
Detached house > €500 > €1100

Apartments

When you buy an apartment, although you own the flat itself outright, you only own a share or a leasehold in the building and/or the land it stands on. As a result, buying an apartment can be more complex than buying a freehold property.

In the Netherlands, each apartment building is managed by an owner’s association called a Vereniging van Eigenaren (VvE). These are responsible for general repairs and maintenance and may be well or poorly run, or even go into debt. As a member, you will be responsible for your share of that debt, so it is important to check into the status of the VvE before purchase.

Further terms and conditions relating to the shared spaces will be laid out in the property division regulations (splitsingsreglement) which should be included with your documentation at the time of transfer.

The buying process

Once you’ve found a property you wish to make an offer on, the next step is to get an appraisal and, if required, a structural or building survey. Contact the mortgage broker you intend to use to ensure you get an appraisal which is also suitable for your mortgage application. You can also request land registry and property value information through the registry office at Kadaster (Dutch).

negotiateWhen you have a clear idea of the value of the property, you can make an offer and begin negotiations. This is usually done through the buyer’s and seller’s estate agents. Negotiations are usually only undertaken with one prospective buyer at a time.

After the sale price has been agreed, the formal steps towards property transfer take place.

  1. Buyer and seller sign a pre-sale agreement (koopovereenkomst) or provisional (voorlopige) contract.
  2. A notary (notaris) is selected who holds the signed contract and a 10 percent deposit paid by the buyer.
  3. The buyer arranges any mortgage they require.
  4. Buyer and seller sign a completion contract (akte van levering).
  5. The notary registers the property transfer at the land registry office (kadaster) completing the process.

Legal requirements

Dutch law requires that a notary must perform the property registration process. The costs will vary and may be a percentage of the property price, a per-hour charge or a fixed fee. As the total cost is usually EUR 1,000–3,000, it’s worth shopping around a little.

A translator is also required to attend notary meetings in cases where one or more of the parties is not a Dutch citizen. Accredited translators can be hard to find, so ensure you book in advance, even if your Dutch is excellent. Translator fees are typically around EUR 200.

Funding: Deposits and mortgages

Your mortgage (hypotheek) will be arranged after the provisional sale contract is signed. However, it is possible – and important – to discuss mortgage terms with one or more prospective lenders before you make an offer. You may also wish to arrange a bridging loan or banker’s guarantee to cover the deposit, for example if your cash is tied up in a property you are selling.
money

Sale fees and charges

In the Netherlands, it is common to have both a buyer’s agent and a seller’s agent. The seller’s estate agent fees will be paid by the seller, otherwise, all fees are typically handled by the buyer.

Budget approximately 6 percent of the purchase price for fees and charges. This breaks down to:

  • Transfer tax (overdrachtsbelasting) currently at 2 percent;
  • Legal fees around 1.0–1.5 percent;
  • Registration fees 1.0–1.5 percent;
  • Estate agent’s fees 1-2 percent.

In any financial transaction, don’t forget to ensure you understand whether the value added tax (BTW) applies, currently at 21 percent, and if so whether it has been included in the quoted price.

The contracts

Pre-sale agreements (koopovereenkomst) or provisional (voorlopige) contracts should include all the usual essential information, such as property details, liens and encumbrances.

contractIn addition, it is important to ensure that it includes:

  • An escape clause, in case you cannot get a mortgage;
  • Clear penalty or escape clauses, in case either party decides not to go through with the deal;
  • Whether any fixtures or fittings are included (such as carpets, light fittings and appliances).

This will form the basis for the completion contract (akte van levering) so it’s important to make sure it’s correct.

There is a legally mandated 72-hour cooling off period after you sign the contract in which you can change your mind without incurring a penalty. After that – congratulations! You’re well on your way to owning your own home in the Netherlands.