Find out all you need to know about the housing market in the Netherlands, if it’s a good idea to buy a Dutch house and how hard (or easy?!) it is to get a mortgage in the Netherlands in 2021.
So you moved to the Netherlands; welcome! Or thinking about moving to the Netherlands? Do it! The economy is still in good shape, summer is coming and corona is on the way out (we hope.) But then there’s the issue of whether or not to buy a house in the Netherlands, and we can tell you that renting a place here is very hard sometimes.
You might be thinking about buying a house in the Netherlands as an expat, throwing yourself into the vortex that is getting a mortgage in the Netherlands as a foreigner. Those are all life choices that you’ve ultimately got to make for yourself. But what we can help you with is explaining the housing market in the Netherlands in 2021!
You don’t want to fiddle around when it comes to life-changing decisions like buying a house in the Netherlands or getting a Dutch mortgage. Neither did we, so we teamed up with the good people from Expat Mortgages. Expat Mortgages has mortgage advisors throughout the whole country which really comes in handy if you’re writing about the housing market in the Netherlands. (So a big shout out to Kenneth from Expat Mortgages who helped us out this time.)
The housing market in the Netherlands in 2021
The housing market in the Netherlands is hot! Not gonna lie about it, buying a house and the subsequent process of getting a mortgage in the Netherlands, is something that comes with some pressure — especially in the Randstad.
But not to worry, with some prepping and studying you can get some basic insight in what’s going on right now and for starters, you can check out this article on why buying a house in the Netherlands is still the way to go for a lot of people.
In 2021, house prices have risen (as always) but at different rates depending on where you’re looking. So let’s discuss the different regions.
Housing prices in the Randstad in 2021
House prices will likely continue to rise in the Randstad, but perhaps less than before, as people move out in search of cheaper properties. In 2021, housing prices rose by 7,8%. Coronavirus was a factor in the housing market, but not a dampening one as was expected at the beginning of the crisis.
In fact, while housing prices in general are on the rise, some of the biggest increases in prices in 2021 were not just seen in the Randstad, but actually in regions outside of it.
Kenneth from Expat Mortgages points out that many of us our now questioning the pull towards the big cities. “Will it really be that important to live and work in the city? Or will we appreciate the extra space, lower price and more home environment an hour and a half away from work? Many of us will ask ourselves these questions, leaving open the possibility to move out of the city.”
The housing market in Amsterdam in 2021! Is it still a good idea to buy a house in Amsterdam?
But before we move to the countryside, let’s linger on Amsterdam. After all, it’s where everybody wants to buy a house but nobody seems to be able to anymore. Overbidding on the asking prices, fully packed visits whenever there’s an open house and units of 15m2 are being sold for the same price that gets you a decent house elsewhere in the Netherlands. Any good news for the housing market in Amsterdam? Well, actually, there is!
Housing prices in Amsterdam 2021
Surprisingly, Amsterdam saw one of the lowest nationwide increases in housing prices this year. In 2021, prices saw an average increase of 4.5% — still an increase but it’s less concerning than in other regions!
This all might signal stabilisation of the housing market in Amsterdam, but the market can still be characterised as “overheated” as there are simply not enough houses being offered for sale. Also, it seems to be that more houses are being sold which were previously being used to rent out. Turns out that even you fat cat expats can’t pay those €2500 rental prices.
The coronacrisis has also stopped the large influx of tourists to Airbnb’s and some internationals have left for their home countries. This has all resulted in the pressure being a bit less on the housing market in Amsterdam in 2021.
However, cities outside the Randstad are becoming more appealing for companies, Kenneth tells us.
“We do see more and more companies expanding or relocating to the Netherlands, but not necessarily to the Randstad. The Northern part of our beautiful Country — take Groningen as an example — is becoming more attractive to these international employers. And the number of employees they will bring or attract from abroad will definitely influence the housing market in the Northern part of the Netherlands.”
Of course, the housing market in the Netherlands isn’t just Amsterdam. Also, turns out that more and more people are discovering other nice Dutch cities which aren’t that far away from Amsterdam.
A move from the cities to the countryside
It seems that coronavirus has led to one significant side effect in the Dutch housing market: people are packing their belongings and moving to the countryside.
It makes sense. Crowded cities have become hotspots for coronavirus, lockdowns make city life even more unappealing, and since we’re all working from home it makes more sense to have a bigger house (and if you’re really lucky, a garden!) These types of homes are generally more affordable in the countryside (or whatever passes for that in the Netherlands).
Wherever you may be fortunate enough to buy, once you get an offer on a house accepted, speed is also key when it comes to getting that all-important Dutch mortgage. So what’s new when it comes to getting a mortgage in the Netherlands in 2021?
Getting a mortgage in the Netherlands as an expat in 2021
A couple of things stand out for 2021. Let’s start on a positive note: while buying a house might be hard sometimes, getting a mortgage in the Netherlands as an expat actually is pretty doable.
The interest rates are historically low, more and more banks in the Netherlands are willing to loan money to expats, and it is a relatively fast and easy procedure. Nowadays you can borrow 100% of the value of the house and you will need to provide around 5% for all the other costs yourself related to the purchase.
Your monthly instalments will depend on the interest rate, the type of mortgage you have and the period you took the loan out for. However, if you choose to make a down payment and take less than 100% then you can significantly reduce your monthly costs. These are all things you can discuss with your mortgage advisor and he or she can help you choose the best option for you.
Kenneth offers us some of his insights into the situation, highlighting that expats are not only managing to get mortgages, but also expand their possibilities with them:
“Whereas in the early years of Expat Mortgages we were mainly busy convincing banks to provide mortgages to expats in general, the last couple of years we’ve seen the range of products and possibilities for expats further expand. For example, buying a new house and converting your current mortgage to a buy-to-let mortgage is something we’ve been arranging for our clients very often the last couple of years, and the amount of banks willing to provide this service is growing as well.”
But not all you internationals have a straightforward case when it comes to getting a mortgage in the Netherlands and for some, the situation is a bit different. For example income from abroad, one partner is a freelancer, living between two countries, etc. A lot of times there are possibilities and it is best to have a chat with a mortgage advisor about all these things — they are the experts after all!
What kind of house should one buy in the Netherlands?
An always important factor for deciding on buying a house is what kind of house you’re going to buy in the Netherlands. First and foremost, it’s a matter of taste. But besides that, we can at least talk about some other factors. Here are three things to know when it comes to the type of house and the housing market in the Netherlands:
The price of newly built homes is going up (fast!)
New Dutch homes are becoming more expensive at a furious pace. In the third quarter of last year, the price of new-build homes that were sold was no less than 10% higher than a year earlier, according to the Central Bureau for Statistics. Existing homes were on average ‘only’ 8.1% more expensive.
A part of this price increase is due to the “energy transition” which is also a good thing since those houses will have energy bills that will cost less on a monthly basis.
Those nice 1930’s houses in the Netherlands
So you might have been driving through a more classical Dutch neighborhood and decided that you wanted to buy one of these houses:
Nicely chosen then, you’ve got some good taste. However, you’re not alone as these 1930’s built houses are always popular and therefore quite expensive. Again, there’s an upside to this as well, as the quality of these classic Dutch houses is quite good (although the energy bill can be quite hefty).
That old canal house or a typical Dutch houseboat?
Perhaps living in a canal house from the Golden age era or in one of those cute houseboats is your #lifegoal. Okay, we can certainly relate, but be aware that these nice looking housing opportunities can also come with loads of repair and maintenance work. Which isn’t only a hassle — especially if you’re an international — but also significantly costs more in 2021 than it did in the years before. Plumbers and carpenters all have plenty to do and have upped their prices. (Just so you know.) 😉
Pro-tip: WOZ value and how this may help you get a better interest rate
The WOZ-value is another term for property valuations. The value of a property is determined by a municipality; it’s called a WOZ declaration. Don’t worry, the gemeente isn’t coming to your home, all houses in the neighborhood get roughly the same calculation.
This value is then used by the municipality to calculate all kind taxes and thus, the higher the WOZ value, the higher the taxes you pay. And WOZ values are rising, so you’re wondering by now why the hell I’m bringing this up?
Well, if you’re a mortgage owner in the Netherlands already, and your WOZ value is on the up-n-up then the risk for your mortgage-lender is going down. And that means, get ready for the good part, that your interest rate is going down. (Which means fewer costs per month!)
The future of the Dutch housing market?
So the prices of houses in the Netherlands are rising, but how long will that last? And will these prices then fall? Well, experts are saying that it’s actually likely that prices will at least be stable and very likely continue to go up in the coming years.
The main reason for this is just that buildings don’t go up as fast as the demand for houses. Building houses is a complex process in the Netherlands and getting permits and all that takes a long time. Thus the prices will continue to be stable and rise a bit and thus, combined with the interest rate development (historic record lows) and general economic predictions in the Netherlands (despite corona still quite good) — it’s still a good decision for many to buy a house now and not wait too long.
But to get a proper forecast and analysis of the area you might be interested in when it comes to buying a house in the Netherlands, you might want to talk to a mortgage advisor who knows the Netherlands and your expat needs.
Get on board with Expat Mortgages to help you get that Dutch mortgage
As an expat you will need some help to secure a mortgage here. This process is already tough for a Dutchie and it’s a life-defining moment. So get help, and who better to ask than Expat Mortgages who already have 13 years of experience in the mortgages advisory business and have helped thousands of expats from different nationalities. As you can see they know their stuff:
This is a big club with advisors throughout the country! So whether you’re interested in buying a house in Groningen or Amsterdam; Expat Mortgages has the right person to advise you on all the ins-and-outs of it.
Want to get in touch for an offline appointment? Well, they can meet you for a no-strings-attached meeting in which you can ask everything about the mortgage possibilities. Or just drop by at one of their events, also conveniently held throughout the country!
Are you thinking of buying a house in the Netherlands? What are your questions and thought about the housing market in the Netherlands in 2021? Let us know in the comments!
Feature image: Abuzer van Leeuwen/Supplied.