9 steps to buying a house in the Netherlands as an expat
You've made the important decision to buy a house in the Netherlands. But as an expat, could you go through the property purchasing process by yourself? Read this detailed step-by-step guide to find out how. [Contribute by Viisi]
As an expat, you have decided to buy a house in the Netherlands. Is this a complicated process? Some advisors or realtors will argue that it is troublesome and difficult for an expat. Nonsense!
Here is a helpful guide on how you can buy a house yourself in the Dutch market the proper way. Below we will discuss nine steps that you will have to take to buy a house in the Netherlands.
If you need any help with one or multiple steps below, do not hesitate to contact us.
Step 1: What is my budget?
It is useful to ascertain your maximum budget before you start exploring the housing market. This depends on a number of things, such as your employment and origin (for example: EU citizen or skilled migrant). View this infographic to get a clear picture of your mortgage options and consult our calculation tool to calculate your budget. Your maximum loan capacity is described in a code of conduct in the Netherlands, which all lenders have to adhere to. In practice it comes down to your maximum loan capacity differing very little among the various lenders. Learn more about this on our website.
Do you have a temporary tax benefit due to a 30 percent ruling? Then it may be possible to borrow more money from a small number of lenders (such as ABN AMRO or Rabobank). We usually recommend you to establish your budget without this temporary benefit, as it would immediately limit your choices.
Step 2: Looking for your dream home
Now that you are aware of your (maximum) budget, you can fully focus on the housing market. This can be done with or without a realtor. If you choose to make use of a realtor, fully inform him or her of your wishes so he or she can help you find your dream home. Most of the Dutch buy a home without a realtor by the way. If you also choose to find your dream home without a realtor, the following websites are helpfull to start your search:
- www.funda.nl (nationwide and by far the most popular website)
- www.Jaap.nl (nationwide)
- www.ikwil020wonen.nl (Amsterdam)
Have you found a possible dream home? Then you can plan a tour with the sellers. The tour is usually supervised by a realtor who acts on behalf of the sellers. You can visit the home as many times as you like. It is common to visit the home two to three times before making an offer. In some cities, such as Amsterdam, many homes are very popular so you can only visit them once together with a number of other interested people. After the tour, you will have to quickly make a written offer. Subsequently, the seller will select the best offer. This is usually the highest offer, however a similar offer without reservations of funding (voorbehoud van financiering) will be valued more by the seller. By making an offer without reservations of funding, you indicate that paying for the home will never be a problem. However, if you are dependent on a lender for the financing of the home you take a great risk by making an offer without reservations of funding. Therefore we do not recommend doing this, unless you are able to pay for the home in cash.
Before making an offer, we recommend carrying out a due diligence:
- In the Kadaster you can find the recent sales prices in the neighborhood and obtain more information about the sellers of the home.
- On Ruimtelijkeplannen you can find land use plans, structural concepts and general rules made by municipalities, provinces and the central government. These plans include descriptions of what public authorities are planning with regard to spatial planning, such as the construction of new roads or new housing developments. Starting from January 1st 2010, the public authorities are obligated to publish their spatial planning on this website. These documents will provide insight into the destination plan of your home and the surrounding area. In this manner, you can avoid undesirable situations, such as years of a view on a building pit rather than a peaceful park.
- When you are looking for an apartment, do not forget to also check whether the Owners Association (VvE) is active.
Step 3: Found your dream home? Make an offer!
After you have found your dream home and carried out due diligence, it is time for one of the most important steps: making a suitable offer. But how exactly do you do this? Well, by using our bidding letter. This letter contains a number of standard reservations, giving you the option to make a suitable offer.
When making an offer, make sure you include as a resolutory condition the reservations of funding for the amount of the purchase price plus 2 percent (and take into account potential additional renovation costs). This resolutory condition means that, after the sale (step 5), you still have a couple of weeks to arrange the financing. If you cannot amass sufficient financing, you are still allowed to cancel the sales contract without paying a fine to the seller of (generally) 10 percent of the purchase price. As a buyer, establishing this resolutory condition offers you a lot more security. A term of six weeks is recommended, because most lenders require up to six weeks to accept the mortgage request. If you are an entrepreneur, a term of eight weeks is advised.
Please note: it is an exceptional condition to void a signed temporary sales contract (voorlopige koopovereenkomst). In almost every other case, the term temporary is misleading. So do not think lightly about signing a contract.
Step 4: Your financial advisor
After submitting your carefully chosen bid, you will hopefully have something to celebrate! When your bid has been accepted by the sellers of your dream home, we recommend you to contact one of our expat advisors — if you have not done so already during any of the previous steps. Together with him or her we will schedule an appointment in the short term to arrange your mortgage. Your advisor will let you know which documents are needed to arrange the mortgage. The fact that these documents are in Dutch should not be a problem for you as an expat. After all, we have created a useful overview for the correct filing of mortgage documents in MijnViisi — your personal, clear online environment.
Step 5: Sales contract (koopovereenkomst)
The realtor of the sellers will normally draft the sales contract. Only in Amsterdam and Haarlem, the sales contract is normally drafted by a civil law notary. Make sure that you have the earlier made agreements during bidding properly included in the sales contract. As said before, stay aware of the fact that in many cases a ‘temporary sales contract is not temporary at all.
The sales contract includes, among others, the following:
- who are the buyers and sellers;
- the cadastral data of the collateral;
- any leasehold obligations;
- the purchase price;
- latest date on which a deposit has to be paid (usually 10 percent of the purchase price) or the bank guarantee is issued;
- date of transfer of ownership;
- final date to make use of the resolutory condition with respect to the reservations of funding.
Dutch law states that you have three days to change your mind after signing a residential property sales contract (cooling-off period). This means that you can, within three days after both parties have signed the sales contract, cancel the purchase without reason or penalty. Often you will have more than three days to change your mind, because:
- the weekend counts as one day;
- the third day cannot be a weekend day;
- the third day cannot be a known Dutch holiday.
Step 6: Two reports: appraisal and structural inspection
For the application of your mortgage, you will need an appraisal (taxatierapport). This report will assess the current market value of your new home. This report is also required by the mortgage provider. Is the assessed market value in the report (much) lower than the purchase price as agreed upon with the sellers? Then this is a valid reason to cancel the purchase (provided this has been properly included in the sales contract) or to re-negotiate with the sellers.
Additionally we recommend you to immediately have a structural inspection (bouwtechnische keuring) performed after the purchase of your dream home. The result of this inspection gives insight into the current state of the home and the maintenance — including corresponding costs — which must be carried out in the short and long term.
We can help you arrange both reports quickly, in this manner there will be as little delay as possible in the purchasing and mortgage process.
Step 7: Applying for the mortgage
Now that all preparatory steps have been taken to apply for a mortgage, you can discuss with your advisor which mortgage will suit you best. As soon as you have made a choice, you will submit your application and the documents will be checked by the lender. This application process takes between three to six weeks. We closely monitor the progress of your application during this process, so that you will not need to worry.
Step 8: Congratulations! You are the new owner of the home
After getting approved for your mortgage, you will visit the notary on the agreed upon date in the sales contract. Often, you as a buyer may choose which notary will be drafting the deeds (transfer of property and mortgage). The rates and quality of notaries may differ. If you are interested, we can help you find a good notary.
At the notary you will sign the official deeds for taking over the property of the home and the mortgage. Prior to signing the deeds we recommend to visit the home one more time to be sure that it is delivered in the right state and has not changed since the last time you visited. After signing the transferand mortgage deed, you are officially the owner of your Dutch home and the mortgage is established!
Step 9: Taxes
After becoming the owner of your Dutch home, there are a number of issues you must arrange taxwise For example the monthly payback concerning your mortgage tax deduction. You can make an attempt yourself, but we recommend you, as an expat, to seek help from your employer or hire a specialist, like Tax Direct. At Tax Direct, Viisi has already arranged a nice discount for you!
Contributed by Viisi
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