How to find your perfect home in The Netherlands
It’s a sellers’ market now (2019) in the Netherlands, and housing is in high demand.
Competition for housing in popular areas is fierce, so be ready to act, bid and sign quickly.
Expats are advised to buy only if they will be in the Netherlands for five years’ or more.
If you stay in The Netherlands for just a couple of years, renting a property is a better option.
TO RENT OR TO BUY?
• If you will live here for more than five years and paying € 2000 exclusive of utilities per month on your lease, you could be better off buying a property in the Netherlands. But there is a downside to this, so get professional advice on this.
• Buyers who want to lease out their property in the future should make sure they are permitted to. Check the terms of your mortgage provider.
• Only interest payments for full-repayment mortgages over 30 years are tax deductible, and the maximum tax rate for deduction will be reduced by 0.5 percent per year until 2040.
FINDING A HOME
• Properties to rent and to buy can be found on online property portals and agency websites such as funda.nl and pararius.com, expatrentals.eu and www.HousingAgent.nl
• There are many agencies specializing in serving expats (be wary of those that charge a registration fee), which is not allowed and forbidden.
• You can contact an agent to help you out in the home finding process. They will actively search the market to find the property you are looking for. An agent that is working on your behalf will charge an agency fee. The going rate is a 1 months' rent + 21% V.A.T.
• If you find a rental property listed on any website yourself, then that agent is working on behalf of the owner, and for that, you are free of any agency fees or contract costs. But, it is recommended that you hire an agent yourself who can help you out with the rental contract and other issues.
• Using a reputable agent, or agency, can help you to avoid renting an ‘illegal’ apartment, a scam, a sub-lease, not getting back your deposit after check out, being bound by an unreasonable contract, or just over paying for a property. You can search all available agents in the market at HousingAgent.nl
• Rental properties that have less than EUR 720.42 base rent (in 2019) will fall under social housing restrictions, and most will not qualify for these properties as they either earn too much or have no required link to the area.
RENTING: USE AN AGENT
• A good housing agent should be able to tell you all about the local market, the city, pricing, quality of housing, restrictions that apply to expats, he/she will arrange viewings for you, negotiate with landlords, and provide an English translation of the rental contract. Helping you to connect with utilities services is also a standard service. A great service to be connected to utilities is www.PartnerPete.com.
Social Housing sector: The dominant distribution sector has rent-controlled social housing, and income status plays its part in allocation. Restrictions are applied by the local authority. Rental properties that have less than EUR 720.42 a month (in 2019) base rent will fall under social housing restrictions.
Liberalized sector: The government regulates base-rents up to EUR 720.42 a month (2019) and anything over this price is in the ‘liberalized’ sector (assuming it has the correct points/price ratio), where rent prices are not restricted.
• Social housing is split into two sectors, depending on whether the property is privately owned, or owned by a housing corporation (=woning coöperaties).
• Housing corporations: A good value, but with many restrictions regarding who may live in their properties. Waiting lists of up to 10 years or more are not uncommon. Only those with a total income of less than EUR 36,798 (2018) and valid residency will be eligible.
• Most expats end up renting accommodation in the Liberalized sector because there are fewer restrictions and housing is easier to rent. Most used contract is Model B, a 24 months lease that can be terminated by tenant with one calendar months’ notice. No extension possible after 24 months.
RULES AND REGULATIONS
• Base rents (kale huur) are controlled by a “system of points”, woningwaarderingsstelsel, The number of points of the property determines the maximum rental price. Each part of the house receives points. For example: the surface of the property, sanitary, heating system, the value of the property.
• Be cautious of sub-lets. You need to be able to register yourself. Do not lease a property where you cannot register yourself to.
COSTS AND CONTRACTS
Your rental contract should cover:
• Status: is the property furnished, semi-furnished or empty? There may be an inventory and/or photos. In today's world all agents will make a digital check in/out report with pictures.
• Duration of lease.
• Notice period and stipulations about how notice should be provided.
• Service charges (check ‘all-inclusive’. What portion is rent?).
• Utilities (apportioned how?). If you agree to a monthly fee, including an advance for utilities, then make sure that utility use is metered for your property. Your landlord should show you an account of payments and real costs at least once a year. Tip: average households (2 persons) pay about €150 per month for gas, water and electricity for an apartment that is about 70 m2 big, with normal consumption.
• A diplomatic clause if you have to leave because your employer has relocated you elsewhere. You need to be clear on when and how this clause can be used to allow you to escape your rental obligations.
• Expect to pay one or two months of rent as deposit – one month’s rent in advance to the landlord, and one month’s rent if you used an agent for your home search.
• Discuss your needs explicitly with your housing agent or relocation adviser.
• Select one, at most two, agencies. Avoid engaging with too many agents for the same objective.
• Arrange viewings three weeks before you need to move in, not earlier.
• Be ready to move quickly.
• If the agent commission seems too much, find property on your own, but be ready to put in lots of legwork.
• Most of all, you will need luck, and timing is also important.
• Post a notice in the housing section of expat forums.
• Contact agents on HousingAgent.nl and write them your detailed requirements.
• Stay clear of anyone asking for a cash payment or cash commission.
• Respond quickly to adverts and take someone along with you when viewing.
• Always check that you can register with the municipality.
• The standard Dutch contract has an English version for comparison/translation.
SHORT-TERM HOUSING OPTIONS
• Many cities in the Netherlands have apart hotels for corporate clients, which can sometimes be less anonymous and cheaper than hotels.
• Websites aimed at tourists – like AirBnB – are great for a private apartment for a couple of weeks or months.
• Short-stay regulations in Amsterdam make it ‘illegal’ to rent the majority of properties for less than six months, but many properties are listed for less than six-month stays regardless.
• It is common to appoint a real estate agent to do much of the legwork.
• An estate agent will track down appropriate houses, arranging viewings, suggesting areas where there’s room for negotiation, and advising on potential pitfalls.
• Local estate agents also know which property will come on the market shortly.
• The agent’s commission will be one up to two percent excl. 21 % V.A.T. of the purchase price. You can read in HousingAgent.nl profiles what the commission or fees are applicable for real estate agents.
• You can hunt on Funda.nl to get ideas of prices in particular areas.
• When buying, commuting to work, schools and amenities all play their part.
• Be aware of the costs involved in renovating older property to current standards or the quality required for leasing out.
• For leasehold properties, check out the ground rent.
• Tax is also levied on the deemed property value (WOZ), evaluated by the local municipality each year.
• See NVM.nl for useful information in English.
ARRANGING A MORTGAGE
There are many different types of mortgage and the tax issues are complex. The general conditions for a mortgage up to four or five times your salary are:
• You have a permanent residence permit (depending on nationality and employment contract, this may not be applicable).
• You have a permanent employment contract or a continuation statement from your employer.
• If self-employed or a contractor, you have certified accounts for the last three years and forecasts for the following year.
• Maximum mortgage obtainable is 100 percent of the house value.
• Find your mortgage adviser on HousingAgent.nl sub-directory.
• The buyer generally pays costs (k.k. – kosten koper) but some costs are tax-deductible.
• Allow for around 4 to 6 % on top of the purchase price.
• Once your offer has been accepted, a written agreement is mandatory, and a 10 percent deposit should be paid.
• Make sure your finances are in place first (ie. that a mortgage lender will lend the required amount).
• On completion, both parties sign a transfer contract (akte van levering) and a notary must register the property at the Land Registry (kadaster.nl).
• Notary fees can range from EUR 1,000 to EUR 3,000, so it pays off to shop around.
• An accredited interpreter must also be hired if one or more of the parties is not a Dutch citizen.
• The whole process can take two to three months.
• Pre-sale agreement (koopovereenkomst): prepared by vendor’s agent or lawyer (notaris) with a 72-hour ‘cooling off’ period. It will include details of when the 10 percent deposit should be paid, or when the bank guarantee has to be arranged.
• Valuation (taxatierapport): designed for mortgage purposes; not a survey.
• Transfer or conveyancing tax (overdrachtsbelasting): 2 percent of the purchase price.
• Deed of transfer: = transportakte.
• Mortgage deed: = hypotheekakte.
• Agent commission: (makelaarscourtage): generally 1–2 percent, if applicable. A full structural survey is sensible; possibly fees for translation, plus 21% V.A.T. on the total.
• Parental gift tax: In 2018 home buyers can still receive up to roughly EUR 100,800 euros as a tax free gift to buy a property.