TO RENT OR TO BUY?

Many expats struggle to decide whether to rent or to buy a house in the Netherlands. Which choice will save you money in the long run, depends on so many factors. The state of the Dutch housing market, the type of home you’d like to live in, how long you plan to stay in the Netherlands: all this comes into play! This page reviews some of the key pros and cons of buying vs. renting in Holland. We also offer a few tips about how you can narrow down your options, in order to find a property that suits you.

Like any country, the Netherlands has seen its fair share of ups and downs in its housing market over the years. When you are trying to decide whether to rent or buy your home in Holland, the climate of the market can be a deal breaker. Here is a bit of background on the recent peaks and troughs:

• In the 5 years leading up to 9/11, housing sales prices doubled in some areas of the Netherlands
• Following that awful day, prices dropped a little, but stabilized shortly afterwards
• Around 2004-2005, they began to rise in some locations
• Amsterdam, for example, saw a spectacular 14% price increase in mid-2008
• This upward spiral of property value continued until mid-2008
• However, in the early summer of that year, the impact of the subprime mortgage crisis reached the Netherlands
• This caused the housing market to enter into a decline, which now appears to have subsided
• Throughout 2015, house sales went up
• In the province of Zuid Holland, they rose by a massive 20%
• In the province of Noord Holland they went up by 8.2%
• The city of Amsterdam saw a rise of 13.5%
• Although prices still remain 12% lower than they were in 2008, this is the greatest increase the Netherlands has seen since then

A Seller’s Market

• Interest rates remain historically low in the Netherlands
• This means that people have more disposable income
• Inflation is low as well, and the job market is on the up
• This means that people will continue to buy houses
• In turn, real estate prices will be pushed up further
• Accordingly, houses that have been sitting on the market for six or seven years are currently being sold
• In some areas, they are going for more than the asking price
• All these developments are examples of how the pendulum is swinging towards the Netherlands being a ‘seller’s market’ again
• So, as a buyer, you cannot expect to be the only viewer of a property for much longer
• ‘Waiting it out’ and trying to buy the house at the price you set will not work for you in the current climate either

So what does all this really mean for buyers?

The Pros of Buying a House in NL

If you are seriously considering buying a house in NL, do not despair! Whilst the Netherlands is technically a ‘seller’s market’, now might still be a good time to buy real estate:

• Prices may be going up
• However, they still remain under what they were when they were at their peak
• Mortgage interests are low
• You will own real estate, the price of which may increase again
• You will be eligible for tax relief on the mortgage interest
• A number of the costs related to financing a house in the Netherlands are tax-deductible

The rental market in the Netherlands is feeling the affects of these housing market developments too. Rental prices are rising, and are around 2% higher than they were in 2015. Still, they remain below those of other European capitals, such as London and Paris.

The Cons of Buying in NL

At first sight, buying a house in the Netherlands can seem very attractive. It does, however, come with some disadvantages:

• You will have to pay approximately 5-6% of the purchase price as one-time ‘buyers’ expenses’
• These expenses include things like: a transfer tax of 2%, the estate agent fees, the civil law notary’s fees, a fixed fee for your bank or broker. Usually, your bank or broker will charge between € 1,500 and € 5,000. There could be even more additional expenses on top of these, depending on your situation
• Home owners must add the ‘deemed rental value’ of their property to their taxable income, and pay taxes on it

The Break Even Point

• These extra costs mean that buying is only worthwhile for those who are plan to stay in the Netherlands for at least another four or five years
• It is only then that you can hope to reach a ‘break even point’ between renting and buying. That is, assuming that housing prices remain constant
• It is important to bear in mind that expatriates usually stay in the Netherlands for a relatively short period of time

Does this Mean you Should Rent in NL?

Of course, if you rent a house, you circumvent a lot of these problems and risks. However, renting has plenty of disadvantages as well:

• The rental market is feeling the effects of the housing market developments
• Rental prices have crept up to almost 2% higher than they were in 2015
• Compared to some other parts of Europe, they are very high
• They remain, however, below those of other European capitals, such as London or Paris
• You also miss out on the possible benefits of buying property in NL!

Looking over all these detailed pros and cons can be overwhelming. There is obviously no one right answer! Therefore, we recommend that you make your own personal checklist. Write down what is most important to you and your family specifically, with regards to a home in NL. You could consider matters such as:

• Proximity to work and the children’s school
• Access to public transportation and school buses
• Neighborhood shopping centers
• Type/safety of neighborhood
• Style of house: period or modern

If you are seriously considering renting, you could think about the following:

• Fully furnished or unfurnished
• Bills included of excluded
• Length of tenancy

For more information on your Dutch rental property options, take a look at our page on ‘The Rules of Renting in NL‘.

When your checklist is complete, start looking at property that fits your criteria.

There is an extremely wide variety of properties to choose from in the Netherlands. Your decision will, of course, be very personal. Ultimately, it boils down to:

• Where you want to live
• How much living space you need
• What you can afford

The majority of Dutch expats opt to rent a property in the ‘Randstad‘:

• This area of the Netherlands holds a lot of good options for expats
• It lies in the Western part of the country
• The cities of Amsterdam, The Hague/Wassenaar, Rotterdam and Utrecht are all part of the Randstad
• Most international companies are based in these cities

Housing Ads in NL

There are so many ways to look for a property in the Netherlands. One option is to review housing advertisements. This can be done:

• Via the internet. Take a look at the list of excellent property websites at the bottom of this page
• In newspapers
• Through estate agent windows
• You can even drive around and look for signs
• They will say either: ‘Te Koop’, which means ‘for sale’, or ‘Te Huur’, which means ‘for rent’

Word of Mouth

Making use of any contacts you have in the Netherlands is also a great way to find yourself the ideal place. Your friends, colleagues and contemporaries may well be in a similar financial situation to you, and living a similar lifestyle. So, their advice can be golden. We encourage you to ask around at:

• International clubs
• International schools
• Churches

Once you have a good idea of what’s out there, find yourself a Dutch estate agent.

Researching for yourself can give you a good idea of what you want. However, we still strongly recommend that you enlist the help of a professional estate agent, especially when it comes to the actual house-search and the negotiation phase. Here’s why:

• Most expatriates have never lived in the Netherlands before
• Consequently, however many houses they have bought or rented elsewhere in the world, they are unfamiliar with Dutch: price ranges, local contracts, ‘invisible’ obligations, laws and customs
• Using an agent is more expensive. Still, he or she can help you get a good impression of a potential living area
• Your agent will speed up your search
• They are trained to negotiate a better deal on a property
• Dutch estate agents also have access to a computerized multiple-listing system
• This enables them to remain up-to-date on the properties available in their district

Hiring a Real Estate Agent in NL

• Try to find a real estate agent who is local to the city or town in which you want to buy or rent 
• Although some realtors work across a wider area, there may be gaps in their knowledge, with regards to the rules and runnings of specific municipalities
• Things such as bidding systems, zoning plans, soil contamination and city council regulations vary from city to city. A local realtor will know all the ins and outs

Dutch Estate Agent fees

• Dutch real estate agents charge a brokerage fee for their services
• This is called a ‘courtage‘ in Dutch
• The brokerage fee is usually around 1-2 % of the purchase price of the house
• Some realtors will be open to negotiating a percentage
• The size of the fee depends the specific services the estate agent offers
• Some agencies offer an expat service package

Finding a Letting Agency in NL

If you are leaning towards renting a property, there are numerous Dutch Letting Agencies you can consult. Here is how you find one:

• Word of mouth is an excellent way of finding a suitable agency
• Draw on the advice of friends, colleagues and family members
• The Human Resources Department of the company you work for may well be able to help you too
• Relocation Agencies can also connect you with local agencies in the Netherlands
• If you do not have access to these kinds of resources, you can find plenty of advertisements in expat journals
• Every Dutch agent who is connected to the largest trade organization, NVM, will have their details published on the multiple listing system
• You can find a list of resources at the bottom of this page

Selecting an Agent

With so many options, how do you find the right Agent?

Whether you are leaning more towards renting or buying, finding your ideal property heavily depends on how good your Agent is. I.e. How well he or she listens to your requirements and uses his or her resources. In order to find a great agent, we advise you to:

• Have a ‘test-run’ meeting, before you agree to work together
• Try to assess whether you can trust the agent
• This can seem like a tiresome and time-consuming thing to do
• However, in the long run, it will save you a great deal of time and effort to use only one agent. Therefore, it is worthwhile making sure they are a good fit at the beginning of your house-hunt!
• If you feel dissatisfied with your agent’s service after a few viewings, find a new one
• There is not point being taken round properties that are not in line with your stated requirements, or trying to work with an agent who does not understand your needs

Another way of narrowing down your options, is to consider which area of the Netherlands you would like to live in. Here are a few tips:

• Most expatriates live in the Randstad
• If you are after a large expat community, this is the place to be
• If you are interested in a quieter, more residential area, there are some very pleasant regions located near the bigger Dutch cities, but outside of the hubbub

Near Amsterdam you will find:

• Amstelveen
• Aerdenhout
• Bloemendaal
• Heemstede

Gooi lies between Amsterdam and Utrecht, and contains:

• Bussum
• Hilversum
• Naarden
• Laren

Near The Hague, and around Wassenaar, take a look at:

• Voorschoten
• Oegstgeest

Rotterdam is home to:

• Kralingen
• Hillegersberg

Of course there are so many more small Dutch villages, full of beautiful houses. There are far too many to mention here, so we encourage you to enjoy exploring for yourself!