Buying a house in The Netherlands?

There are basically two scenarios when looking for the perfect home:
1. You can search through specialised sites, like Funda or VBO and make selections and appointments yourself. You will call a real estate agent the moment that you have found a suitable object and he/she will accompany you from that moment onward. The agent will assess the property and give you advice on all matters that are relevant in the buying process. And of course they will do the negotiations for you.

2. You contact a real estate agent right away. We advise you to do so since they have access to an intranet that offers objects before they are shown on the different search sites. You will be informed by your agent about available houses based upon your profile. He arranges the appointments and gives you the full service for each object that you want to visit.
Fees for services from an agent differ from agent to agent.
The fee for a full-service will be between 1% and 1,75% exclusive of 21 % value added tax (BTW).
Expat Mortgages has agreements a great network of specialized agents used to dealing with international clients.
If you want more information, please send an e-mail info@expat-mortgages.nl  or call our office.

When buying a house in the Netherlands, the purchase will in most cases relate to one of the two types of immovable property described below:

1. The purchase of a house, registered independently as a whole at the land registry.

2. The purchase of an apartment right, registered as such at the land registry and managed by the board of an Owners’ Association (VvE). An apartment right consists of part of a whole apartment complex. You will often come across this situation in cities like Amsterdam, Rotterdam, Utrecht and The Hague, for instance.

You have a statutory right to cancel the contract of sale within three days of signing it, without giving reasons (cooling off period).
A civil-law notary is always involved in the purchase and sale of immovable property.
The property buyer is entitled to appoint the civil-law notary of his or her choice. We will be glad to help you find a suitable civil law notary!

As a rule of thumb, the buyer’s costs usually amount to around 6% of the purchase price for the immovable property.

The contract of sale sets out information about the house, the price, the obligations of the buyer and the vendor, the date of conveyance and the guarantee. The guarantee comprises a 10% down-payment to the civil-law notary’s escrow account.
That 10% can be paid in cash to the civil-law notary’s third-party account if sufficient liquid assets are available.
Another option is to guarantee the 10% by a bank guarantee. Expat Mortgages can arrange the bank guarantee on your behalf.

The contract usually includes a clause stating that the agreement is subject to financing being arranged.
That dissolving clause specifies the amount of time you have to arrange financing so that the purchase can proceed. If you do not succeed in obtaining a mortgage within the agreed period (4-6 weeks in general), you can unilaterally terminate the contract. You will however need a written statement from two banks confirming that they have rejected your application for a loan.

Buying a home and the accompanying costs
The price of a house in the Netherlands is always followed by an abbreviation, either ‘KK’ or ‘VON’
‘KK’ means that all of the costs related to buying a house are paid for by the buyer (‘Kosten Koper’, or ‘purchasing costs payable by the buyer’).
‘VON’ stands for ‘Vrij op naam’, or ‘purchasing costs payable by the vendor’, which in most cases only applies if you are buying a newly build property.

For that reason, we will concentrate on ‘KK’

These costs include:

• Transfer tax (2%)
• The costs of registering the  property in your name and having that information filed in the usual registers (civil-law notary).
• The costs of your estate agent (if applicable)
• The fee of Expat Mortgages
• The National Mortgage Guarantee costs (if applicable)
• The costs of registering the mortgage in the usual registers (civil-law notary).
• The costs of the valuation/appraisal provided by an independent surveyor
• The bank guarantee costs (if applicable)
• The costs of an structural survey (if applicable)

When preparing your mortgage application we will need the following information from you:
1. Information about you personally
2. Information about the to be mortgaged property
3. Information to substantiate your financial position

1. Necessary information about you personally
• A copy of your passport
• A copy of your residence permit*

2. Necessary information about the mortgaged property
• Copy of the purchase-agreement, signed by both parties
• Original valuation/appraisal report
• Structural survey report (if required)

3. Necessary information to substantiate your financial position
• Employer’s declaration. A statement made by your employer confirming your annual income based on salary, bonuses and fringe benefits.
• Salary specification. Your monthly pay slip, which will correspond to the information given in your employer’s statement, and which will also show aspects such as the 30% ruling, expenses, payable taxes, etc.
• Statements of savings accounts or loans, investment portfolios and property owned outside of the Netherlands.
• Confirmation of the tax department’s granting of the 30% ruling (if applicable).

In the Netherlands it is not allowed to transfer the ownership of a house in the Netherlands without engaging a civil-law notary. The civil-law notary is impartial. More about his role you can find at http://www.knb.nl/english

What we take care of:
– We have agreements with civil-law notary firms in most regions concerning the service to our customers, communication in English and the fees charged by the civil-law notary.
– We have agreements with interpreters who are familiar with the methods used by the civil-law notary for the transfer of title of real estate
– We check the statement of completion of the notary on behalf of our clients.
– We will be present during the transfer of title procedure and, if necessary, when the (provisional) contract of sale is signed.

What the civil law notary takes care of:
• He draws up the contract of sale (this can also be done by the estate agent or another party).
• He draws up the deed of delivery for the home.
• He draws up the mortgage deed.
• He has the details filled in the public registers.
• He carries out a survey (to establish, for example, whether the vendor is entitled to sell, whether the home is subject to an attachment order, etc.).
• He attends to the settlement and transfer of funds.

Costs:
The fees for notarial services were liberalised a number of years ago, and civil-law notaries these days compete on price and service. You will often be given a discount if you have the civil-law notary carry out several tasks at the same time (e.g. drawing up a cohabitation contract, a will, etc.)

In the Netherlands paid interest regarding the mortgage of your main residence is still tax-deductible for a maximum of 30 years (Tax Box 1). Main requirement: the mortgage is a capital repayment mortgage.

Provisional refund
Usually you pay your mortgage interest monthly. For that reason it is useful if you can also receive your tax benefit monthly. Expat Mortgages organises the provisional refund for its clients free of charge for the first year.
That way, the balance between your monthly mortgage expenses and the tax rebate becomes your net monthly payment.
For more information about this topic, please click this link
Deemed (rental) income
Private home ownership is deemed in the Netherlands to be an income constituent for income tax purposes. Costs, charges and depreciation related to home ownership are eligible for a tax allowance.
Home ownership and the expenditure referred to above are incorporated as a fixed sum in the taxable (net) deemed rental income. Also, the payable interest and the costs related to the home acquisition debt can be deducted from the progressively taxable income from employment and home ownership (box 1).

Tax Box 3
Similar to capital gain tax with fixed gain of 2.87% up to 5.39% pa (percentage subsidiary of your net assets) taxed with 30%

For general information about taxes in the Netherlands, please click here

There are several reasons why it makes sense to keep in touch with us!
1. You would like advice on other financial matters.
If we are unable to help you ourselves, we will be pleased to introduce you to one of our business partners. This could relate to matters such as: Insurances, Financial planning/investment advice, Pension issues, Tax advice, Renovators or Interior decorators.
2. You want to let your house or apartment after getting permission of the mortgage provider and would like to get in touch with specialized real estate companies.
3. You are moving out of the Netherlands. In that case we can help you to sell your home.
4. You would like to get you in touch with a tax consultant to tie up all the loose ends before leaving the Netherlands.

Expat Mortgages has a loyalty program for existing clients who refer us to new ones. For more information, please send us an e-mail!