Thousands of homes can't be sold due to private ground rent

Thousands of homes can't be sold due to private ground rent

9th January 2014, Comments 1 comment

Tens of thousands of Dutch homes remain impossible to sell because they have been built on privately-owned land, according to real estate agents' association NVM.

In 2011, it emerged that banks had suddenly all but stopped giving mortgages to people who want to buy property situated on another private owner's land and therefore subject to ground rent (erfpacht).

The banks consider it too risky to do so, because the land owner can increase the ground rent at will. This, they say, could mean people default on their mortgages.


Since then, efforts have been made to find a solution for the problem but with only limited results and the banks are continuing to exclude a large number of properties, the NVM says in Thursday's Volkskrant.

The problem is particularly acute in Amsterdam and in houses built on country estates or in rural areas. Last year, the banks agreed to allow notaries to advise on individual ground rent contracts but in three quarters of cases there are still problems, the Volkskrant says.

‘The aim of the new procedure was to make it possible to sell houses on land owned by third parties,' said Piet van Buuren from a lobby group representing people unable to sell their homes. ‘In some cases, the notaries are being demonstrably tougher than was agreed.'



1 Comment To This Article

  • helga posted:

    on 9th January 2014, 18:49:33 - Reply

    The Dutch are taking out their 'polder model' out of the closet again.
    They are making absolutely sure that not a single landlord owning land can sell his erfpacht (lease his land to the public) by simply ensuring the banks will only finance erfpacht coming from the municipality of amsterdam and not when it is owned by private individuals- that way, private individuals can never monetize what they own. This way, all the private individuals with land to lease won't find buyers, even if they put their land up for rent for half the price of that of the municipality. May be they want the owners to sell back land to the government?
    Bottomline, this is effective monopolization of scarce resources by our lovely Dutch cloggies. They used to do this during the West Indian companie too, with slave trade - curiously, only the 'state' had monopoly. I think this is what we thought they did in communist countries.