Buying a house in Holland 

In this article we would like to touch on some of the pitfalls of buying a home in The Netherlands.

Be very careful when making an offer for a property - even verbally. ALWAYS add the caveat 'subject to raising the finance'. Until you actually have an offer of a mortgage from a recognised lending institute (bank or insurance company) you cannot be certain that you have the necessary finance available.

Under Dutch law, if you have not added the caveat, you could be subject to a penalty of 10 of the offer price if you withdraw your offer because you are not able to raise a mortgage. EVEN IF THE OFFER WAS ONLY VERBAL.

Many brokers can product illustrations from a number of different institutions. We, for example, have the software of 9 different institutions on our office PC. However anything we produce is nothing more nor less than an illustration! IT IS NOT AN OFFER since, in part, an offer is attached to a specific property.

Many apartments in the major cities are leasehold (erfpacht). Your broker will check this BEFORE you make an offer because, depending on the terms of the ground rent, you may not be able to raise all of the mortgage you require.

Make sure you are buying for the right reasons. Buying 'as an investment' is a matter of opinion. Our opinion (for what it is worth) is that the glory days of double-digit growth on property prices (particularly in the Randstad area - Amsterdam, The Hague, Rotterdam) are behind us. It is noticeable in recent months that property is remaining 'te koop' for longer and longer. Against this interest rates are falling and there is less and less rental property available mainly because of a growing population (up from 15 million to 16 million in 5 years!). So, WE THINK, prices have probably reached a plateau where they will remain for a few years.On the other hand, most expatriates start off in rental property and are probably paying €1,000 per month or more in rent. For this amount, taking tax relief into account, you could easily finance a mortgage of between €275,000 and €318,000.

In other words, rental replacement is a better motive than 'investment'.
If you are self employed you are required to produce 'proof of earnings' when applying for a mortgage Make sure the accounts you produce are endorsed by a recognised accountant. 'Boekhouder' in Dutch means 'bookkeeper'. No institution that we know will accept accounts prepared by a 'boekhouder'.

You will be eventually required to produce a valuation (taxatierapport) - at your expense - to support your application. This MUST be produced by a recognised assayer (taxateur)' who is not the agent actually handling the sale, but who is a member an association such as NVM or RVT. We as P