How to Buy a Home in the Netherlands

How to buy a home in the Netherlands as an expat

One evening, a frantic call was made to the Dutch emergency services number 112.

Operator “Emergency services, are you calling for the Police, Ambulance, or Fire Brigade?”

Caller: “I’m calling for the Fire Brigade”

Once the caller had been put through, the operator asked for more details

Operator: “What’s the nature of the emergency?”

Caller: “You must send someone ASAP, I’m stuck in a lift”

Operator “A team will be sent to your location and will arrive in approximately twenty minutes”

Caller: “No I can’t wait that long, I need help NOW!!!”

Operator “Caller, please calm down, do you suffer from claustrophobia?”

Caller: “No, it’s worse than that, I’m stuck in the lift with a makelaar, a mortgage broker, an accountant and a notary”

Operator “Oh now I understand the urgency. We’ll send the army to free you ASAP”

How to buy a home in the Netherlands

On a cool November evening, the Shallow Man, tempted by the offer of free alcohol and snacks, attended the Expat Housing Seminar.

The aforementioned makelaar, mortgage broker, accountant, and notary were present, along with over sixty expats curious to learn how to navigate the red tape infested waters of buying a home in the Netherlands.

My secondary reason for attending the event was to mingle with some expats, promote my blog,  and interview some of the attendees, a win/win. Well, it was a win for me, the obvious negative for them being that they would have to endure a conversation with the Shallow Man.

The purpose of the event was to provide a no-strings-attached guide to expats on the process of buying a property in the Netherlands.

Our host for the evening was Henk Jansen, co-owner of expat mortgages, who made a bold fashion statement by wearing shoes that were so bright that I wish that I’d brought sunglasses with me. Not afraid of being laughed at, he wore shoes of a colour that could only be sold to men in the Netherlands, they were pink.

The Mortgage Broker

Fortunately, in spite of his taste in shoes, Henk proved to be an informative and entertaining presenter.  He explained the eligibility of expats for mortgages in the Netherlands. One of the questions asked was:

If I’ve only been in the Netherlands for less than a year, and have no credit history here, does this affect my ability to qualify for a mortgage?

Henk explained that unlike, the US where you have to build up a credit history over a period of time, that this isn’t really a requirement in the Netherlands. The prerequisites are that you should have a bank account with a Dutch bank into which your salary is paid. He also explained that in 2014 the maximum mortgage amount was 104 percent of the value of the property. This will be steadily reduced until in 2018 it will be 100%.

He made the point that the advantage of using a broker to arrange a mortgage is that they will shop around and negotiate the best deal to fit your circumstances. This is often more cost-effective than simply arranging everything with the bank where you have your account.

The Makelaar

Sadly, the next step to buy a home in the Netherlands is unavoidable, you will have to deal with a makelaar. The Shallow Man is generally not too keen on makelaars and advises that after shaking hands with one to double check if your watch is still on your wrist. Yes, it’s fair to say that I don’t particularly hold Amsterdam rental makelaars in high regard. Mie-Lan Kok of the estate agents of the same name gave a credible presentation of the value of using a makelaar during the buying process. In fact, I was surprised to learn from her talk that makelaars don’t just show people round apartments, point out the bloody obvious, then sit back and count the commission money once the sale has gone through.

She used an original analogy to describe finding a home to buy.

Buying a home is like falling in love

The implication being that as with falling in love and getting married, if things go wrong it can be bloody expensive. She gave the example of a client who had fallen for her dream apartment in the Herengracht. Her client was almost ready to sign on the dotted line when Mie-Lan found out that the apartment, being in a monumental listed building, came with high monthly maintenance costs that were shared among the apartment owners. These additional costs were out of the buyers budget.  Heartbroken, the potential buyer had to walk away from the deal, but rest assured she later found true love with another apartment that was well within her price bracket.

Due-diligence for additional costs and risks associated with a home are part of the service provided. She also advised that when choosing a makelaar to ensure that they are members of professional trade associations such as the VBO or the NVM as unsurprisingly there are lots of unqualified cowboys and clowns operating as makelaars.

“Yes the place is falling apart but it’s reflected in the price”. Beware the scary clown makelaars

How to buy a home in the Netherlands The Accountant

Arnold Waal, an accountant from Orange Tax Services discussed the tax implications of buying a home in the Netherlands. Incredibly, the audience remained awake throughout, or so I was told, as I couldn’t help but nod off for a minute or two 😉

One of the biggest advantages of owning a home in the Netherlands is that the mortgage interest on the primary residence is tax-deductible for 30 years. This can be refunded to the mortgage holder on a monthly or annual basis. There were a number of questions raised about this, including what would happen if an expat moved abroad and sublet the property. How would this affect the tax status?

The Notary

Bert Buma, a civil law notary, walked the audience through the various legal steps required to complete the purchase of the property. Just as you can’t use tinder without a smartphone, Dutch law doesn’t allow the completion of a transfer of property ownership without using a notary. Bert explained the role of the notary in the process,  including things such as the all-important cooling off period, and the relatively new requirement to ensure that contracts must be read out in the native language of the buyer of the property. An official registered translator needs to be hired for this in most cases and is something that can be arranged by the practice as part of the process.

A lively question and answer session followed, after which drinks were served. I asked some of the expats present about their current situation and plans

I’ve lived in Amsterdam for five years, and am now on a local contract and am paying a lot of money in rent. This event has confirmed what I thought, which was that with the tax rebate on interest I’ll end up saving money by buying instead of renting

This was a common sentiment shared by the people I spoke to. The general concern is that with annual rises in rents it was worth investing in property here, even if the length of stay in the Netherlands wasn’t planned to be permanent.

The next Expat Housing Seminar will be held on March 20th at 18:30 at Stadskasteel Oudaen Oudegracht 99 3511 AE Utrecht

Click here to sign up to attend. If you’d like to know how to buy a home in the Netherlands, knowledge is power, and the seminar will provide you with all the information you need to make informed decisions.

No landlords were hurt during the writing of this post.