Home Housing Buying Buy-to-let mortgages in the Netherlands
Last update on March 12, 2019

Foreigners can invest in buy-to-let property in the Netherlands, provided certain conditions are met.

Expats often ask whether it would be possible for them to purchase a rented apartment or buy-to-let investment. Against the backdrop of low-interest rates and rising property prices, apartments and residences in the large Dutch cities are considered an interesting investment. In addition to gaining rental income, forecasts project that buyers can expect an increase in property value as well. Buy-to-let properties can be purchased with private cash, however, taking out a mortgage has recently become an option as below.

Conditions for buy-to-let investments in the Netherlands

On behalf of the expat community, Expatica investigated the requirements for foreigners looking to invest in a buy-to-let property in the Netherlands.

Expats must have spent at least three years living and working in the Netherlands. Their minimum gross income should be EUR 45,000 per year. Also, the EU nationality condition applies.

Another significant detail is that private cash is required at all times. The bank provides a loan up to 70% of the value of the property, which means the remainder of the purchase needs to be financed with own cash.

Getting a mortgage for buy-to-let property in the Netherlands

Provided the above conditions are met, a mortgage can be requested. The bank will set yet a few more conditions regarding (the rental of) the apartment. For instance, a permanent occupation needs to be the case. AirBnB or any other short-term rental is disallowed.

Bank may only finance apartments and residences located in large cities due to the minor risk of vacancy.

Up to 50 percent of the value of the property can be an interest-only mortgage. If the mortgage exceeds 50 percent, then the remainder up to 70 percent needs to be repaid on a linear basis in 10 years. Further, the yearly rental value / yearly mortgage cost (interest and repayment) ratio needs to exceed the norm of 1.25.

The tax consequences are as follows. For the value of the apartment (less the mortgage), a 1.2 percent levy is indebted annually. This is the box 3 levy in the income tax.