Recovered from the crisis

The housing market has mostly recovered from the crisis, and prices are now approaching pre-crisis levels, sometimes even exceeding them. Certainly around Amsterdam, Utrecht and The Hague, where properties often sell without ever making it to a housing website. Sometimes the asking price is actually the starting price, as many people will be bidding for the same property, driving up the price.

Where to start looking

The best way to start is via websites such as Funda.nl (in English as well as Dutch), Jaap.nl, or VBO.nl. Contact information for the estate agents are available to make an appointment for viewing the house, or you can often visit the property during open house hours. Especially in the big cities, this is a convenient way to see the home without making an appointment

Mortgage

When you’ve found your ideal home, you need to know if you can borrow the required amount of money. You can also do this before you even start looking, so you know the maximum home price you can look at. You can always make an initial appointment with an Expat Mortgage Advisor, free of charge of course.

Other things to take into account

As in other places, the difference between buying a house and an apartment is that buying a house makes you the sole owner of the building and grounds whereas an apartment has shared ownership (apartment right, giving you the exclusive right to live there).

In Amsterdam and other cities, a ground lease is often used (erfpacht in Dutch). It does not give you ownership of the grounds but instead earns you the right to use it for an annual fee.

With a regular mortgage, you can only buy a house for self-occupancy, and you are not allowed to rent it out (subletting). Only in special circumstances, like a long-lasting vacancy or a transitional period would this be possible, and then only for a limited period of time and with the consent of the mortgage provider. If you are interested in investing in a house for renting out to others, there are specific mortgages available. In these cases, the interest rate is higher and you have to invest up to 30-50% of your own money.

Real estate agent or do-it-yourself?

Especially in areas with high demands and fast turnover, you could benefit from employing a professional. Real estate agents know the market and get notified of new houses on the market before they are posted online. They can also easily reach out to colleagues to negotiate on your behalf. A fixed fee or a percentage of the buying price might well be worth paying in order to get the home you love. If you are interested in working with professional real estate agents, feel free to contact us for more information. 

The bidding and contract process

Although not guaranteed, most sellers will usually negotiate exclusively with you once you’ve placed a bid. Only after your bid is declined will they entertain other bidders again. If there are many interested parties however, the seller may opt for bidding by tender, in which case many bidders can submit their bids at the same time. The seller will then pick the best bid, which is not always the highest one.

Once your bid is accepted, you will sign a preliminary purchase agreement within a few days. This contract, usually drawn up by the seller, describes the house and records the price and the date of closing the deal, as well as the obligations of both buyer and seller. The agreement includes clauses for cancellation of the deal if something doesn’t go right.

Be aware that a verbal agreement, even confirmed via email, is not binding yet. Only once a purchase agreement is signed is it legally binding and can the seller no longer pull back to sell to someone else. This is an exception in the Dutch legal system as all other verbal agreements, for example for renting a property, are legally binding. On the buyer’s side, you have a three-day cooling-off period after signing the purchase agreement, in which you can still cancel the deal without reason and without any costs.

It is always a good idea to include a few cancellation clauses of your own. For example, in case you are unable to get the mortgage (restriction of finance clause), or the National Mortgage Guarantee (insurance that covers inability to pay the mortgage in case of unemployment, inability to work, or divorce), or in case things turn up at the time of the home inspection. Again, you will still have three days to cancel this agreement without further restrictions.

When it is time to close the deal, you should inspect the property to confirm the condition you expected and go to a civil law notary together with the seller to settle the purchase. The notary will legally transfer the ownership of the house to you and arrange the payment to the seller.

Financial considerations

The seller will ask for a financial guarantee in the form of a 10% deposit. These must be deposited into a notary’s escrow account. In case you do not have sufficient cash on hand, a bank guarantee – a note that guarantees that the bank or lender will pay the deposit in case of a contract breach on your end – should be provided. The deposit is kept by the seller in case you break off the contract without a valid reason.

In the Netherlands, the maximum amount you can finance is 100% of the market value of your house, so some costs involved in buying the house must be paid out of pocket.

What we can do for you

An Expat Mortgage Advisor can help to:

    1. Find a translator for you if needed
    2. Connect you to the best real estate agents
    3. Find a good appraiser
    4. Find the best mortgage
    5. Recommend a good and inexpensive notary

We are here to keep an eye on the process and help in any way we can. Don’t hesitate to contact us for more information about us or our services

Expat Mortgage Advisor works with more than 25 mortgage providers

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