House buying involves 2 parts:
- Finding a suitable house to buy
- Finance arrangement
Finding a suitable house:
- Go to a ‘loan adviser’ (hypotheek) and ask for the maximum loan amount you are eligible for
- Go to funda.nl and search for the house you would like to check out.
- Via the website contact the ‘selling agent’ (called maakalaar in Dutch) and ask for a viewing
- The agent will call you for an appointment
- If you don’t like the house you can simply say no to the agent.
- If you like the house the below steps follow
- (optional) ask for a second (or even third) viewing of the house till you are absolutely sure you want to buy
- (optional) ask for a technical inspection: you hire a technician who will inspect the house and identify the problem/alarm points
- negotiate the price. You can hire a ‘buying agent’ or do it yourself for this. ‘buying agent’ is nothing but a competitor house agent.
- give oral consent to buy the house. The ‘selling agent’ and/or ‘buying agent’ will draft a contract in about a week and ask you to sign it. Once the contract is signed:
- you still have 3 days time to change your mind on buying the house. Beyond this, if you decide not to buy, you will have to pay penalty.
- the contract gives you few weeks time to arrange for the house finance. In case the bank decides not to give you the loan, then the contract is cancelled and there is no penalty you need to pay.
- if the bank takes more time to approve the loan, the contract is automatically cancelled unless you mutually agree for more time thru the agent. So it is important that you start the loan arrangement procedures immediately.
- Contact a bank or ‘hypotheek advisieur’. They will ask you for your current financial details, job details and a few documents including ‘werkgeververklaaring’ statement from your employer which is nothing but a document where your employer gives a summary of your annual gross and how long you are expected to be working in Netherlands.
- The loan adviser will tell you the interest you pay depending on factors like your residence status, value of the house, length of job contract, citizenship/PR status, down payment from your side etc. The interest you pay to the bank is tax deductible. So in reality you pay much less than the bank interest. Ask the loan adviser for the net interest rate you pay.
- The loan is usually given for 30 years.
- The interest rate can be fixed or floating or a combination of both
- Even after the initial discussion the bank will take about 3 to 6 weeks before approving your loan.
- When the processing for the loan is going on, arrange for the gas, water, electricity transfers. Arrange for internet and most importantly house insurance.
- Once the loan is approved the transfer of funds to the seller happens in presence of a notary (the notary though a private person, is an authorized person by the government for house transactions):
- just before signing and approving funds transfer you revisit the house to ensure it is in the same state as when you went for the viewings (minus the belongings of the previous person living there when you visited it)
- in case you find deviations that the seller also agrees, you can raise your concern and withhold funds required for repair or cancel the deal altogether in case it is really bad.
- you then directly go to notary and sign the document for funds transfer. In case funds need to be withheld, you need to tell the notary about it. Note that if you are not proficient in Dutch, there is a mandatory translation fee wherein an interpreter will communicate to you the discussion with the notary.
- once the document is signed you get the keys and you are the owner of the house. You must have arranged house insurance as the bare minimum requirement before this date. If you have not done gas/electricity/water/internet transfer, initiate the process right away.
- When you view the house the second/third time, it is good to make a thorough check to get an idea of the additional investment needed before you get it to the shape you need the house to be. Check for water leaks, dishwasher, oven, microwave, fridge, gas/induction units paint inside/outside, mould, door close/open, shower, hotwater etc are working properly.
- The house you will get will most often not look like the way you saw it. Unless agreed the curtains will be gone, flooring also may be, the furniture of course. Most importantly the walls are likely to have several holes from the paintings, clock etc of the previous resident. Be prepared to see what you get.
- When you want to sell, it may not be easy to sell a house. It may sell in just a few days or remain unsold for years. Understand the risk before buying. Normally it is considered a good option to buy when you know you will stay for 4+ years.