Buying versus renting in the Netherlands

An article by Mister Mortgage

Many internationals relocating to the Netherlands face a dilemma: renting or buying a home. Of course, it depends on your preferences and plans for the future.

Short-term versus long-term solution

Renting can be seen as a viable option if you plan to stay for a short time and need the flexibility to leave. There are no maintenance costs that you need to cover. Your landlord usually covers any major repairs beyond tear and wear. On the other hand, buying a home offers a cheaper solution in the long term. As a homeowner, you build equity during the mortgage period, and if you decide to sell your home one day, you earn money. Use an online calculator to check how much equity you build after selling a home. Additionally, the freedom to renovate the house however you like is also a motivation for many people who opt to buy instead of rent.

Advantages of renting:

1. Adjustable end of the contract.
2. No repair costs for the tenant.
3. Good short-term solution.

Advantages of buying:

1. Build equity on the property.
2. Tax benefits.
3. A cheaper solution in the long term.
4. Borrow capacity 100% loan to value.
5. Freedom to renovate.

Use this reversed calculation tool to get an idea about the monthly payment comparison.

Dutch mortgage benefits

What makes Dutch mortgages accessible is that you can borrow up to 100% of the property's value. Your maximum mortgage sum depends on your annual income. Besides, there are also quite a few tax benefits you are eligible for when buying a home:

• Mortgage interest (annuity and linear) is tax-deductible in the Netherlands.
• No capital gain tax when selling a property.
• No 2% transfer tax for first-time homebuyers aged 18-34 if their property is worth less than €400,000. Use this calculator to check if you need to pay a transfer tax.
• Discounts on mortgage interest rates for homes with certain sustainability standards, e.g., energy label A, can lower your interest rate (by making your home sustainable, you also reduce CO2 emissions, increase the property value, and lower your utility bills).

Dutch requirements for buying a home

1. You need aBSN number to get a mortgage in the Netherlands.
2. If you come from a non-EU/EEA country, you also need a valid residence permit (if applicable).

You can get your maximum mortgage calculation even if you do not have a BSN. It is, however, still necessary to have your BSN number to apply for a Dutch mortgage.

Savings needed to close a mortgage in the Netherlands

Prepare your savings and start your mortgage application. Other fees you might encounter when closing a mortgage are:

• Transfer tax of 2%- (if applicable).
• Real estate agent fee. It is highly recommended to cooperate with a real estate agent if you want to win a bid.
• Notary fee- the legal assistance needed when a property is transferred from one person to another.
• Translator fee.
• Valuation report.
• Mortgage brokerage fee.

Do you wonder how much mortgage you can get in the Netherlands? Visit the website of Mister Mortgage to schedule a free call to calculate your maximum mortgage in the Netherlands.

About Mister Mortgage
Mister Mortgage offers financial advice for first-time homebuyers, people moving homes, and keep-to-let homeowners. We believe in transparency, integrity, and growth for a bright future. Please visit their website to find more information about mortgages in the Netherlands.