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Amsterdam Real Estate

The following is an article I commissioned on Amsterdam real estate (in 2011), by a writer who lives there. He covers the basics of what it takes to rent or to buy a house or apartment, both for a local resident and for expats from the United States or other countries.

Introduction

Finding a place to live in Amsterdam can be a challenge. However, with research and the right advice, you can find your perfect home in a popular market. When searching for accommodation, there are three possibilities: public housing, private rentals and buying property.

The real estate market in Amsterdam is a something that can't easily be put into words. Most Dutch people have registered themselves to receive public housing which means that they'll receive a flat in the area of their choosing if they wait for it. Sounds quite good so far, BUT the time they have to wait is easily around 10-20 years. After all that time they receive offers for rental housing in the area they have selected for a price which is much lower than the open sector housing. As an example if you'd like to rent an apartment in Amsterdam you'd be looking at 1,100 dollars monthly rent. That is the bottom criteria that is not easy to find and for most people isn't big or comfortable enough. The more spacious or better located housing starts at 1,650 dollars per month. When you happen to be the patient and lucky person who is entitled to receive public housing then the costs would start around 350 dollars per month. So the change is dramatic.

Buying Housing

If you're planning on staying in Amsterdam for three years or more, then one option may be to buy a property. In this economic climate, you'll find there's less competition as well as significant tax incentives and long-term benefits of owning your own home. The lowest price range starts from around 140,000 dollars. If you're considering buying a house, it is advised to first meet with a mortgage advisor at your bank or an agency. The choice of property is either freehold (vrij leen) or leasehold (erfpacht). You will not need a housing permit for an existing property but you will need one for a new build if the purchase price threshold is 224,674 dollars (correct from 1 January 2009; indexed annually).

There are many ways to go about house hunting:

* Estate agents (makelaars) - They will keep you informed of suitable properties for sale, arrange viewings and offer practical advice. Commission is usually 1 or 2% of the eventual purchase price, plus VAT (BTW). Recommendations are always a good start. Addresses can be found in the Gouden Gids (Yellow Pages).

* Adverts - Local papers usually carry a housing (woon) supplement on Wednesdays or Thursdays. Also try special property papers.

* Online – Estate agents regularly publish their stock on the major property sites: Funda and MVA-Makelaars (both in Dutch). If you've already working with a mortgage advisor, ask if they can notify you of new properties (some get houses before they even go on Funda).

* New builds – If you're interested in a new build or want to look at projects under construction, visit www.nieuwbouw.amsterdam.nl (in Dutch only).

If you find something you like, be on the look out for:

* Costs – For properties advertised as kosten te koper (KK), you will be obliged to pay expenses for things like the services of an estate agent, transfer costs etc. If a house is advertised as vrij op naam, all costs are included in the price.

* Negotiation – If you are in negotiations with a buyer, the seller's estate agent is still allowed to show the house to other parties. He is usually working on the side of the buyer, so try and protect your interests using your own agent or a friend who knows the system.

* Asking price - Base your price on the market value of the property, not the asking price. Make sure your offer is made with the proviso "subject to raising finance". The written agreement is known as Presale Agreement/Contract of Sale and must be drawn up by a lawyer and signed by buyer and vendor. You’re allowed a 3-day cooling-off period for withdrawal. Beyond that, you may risk a penalty of 10% of the asking price if you pull out for lack of funds.

Arranging a Mortgage for Amsterdam Real Estate

Generally the cost of buying a home is around 8% of the purchase price. Banks may lend up to five times your salary if you meet the following conditions:

* You have a valid residence permit.

* You have lived in the Netherlands for five years.

* If self-employed, you can produce statements for the last three years and show future potential earnings.

You'll find a wide variety of mortgages (hypotheek) on offer but as an expat, it’s advisable to do your homework and ask friends or family for recommendations to get the best deal.

When it comes to the actual purchase, you will have to provide a property valuation report (taxatierapport), which is usually arranged by a valuer (taxateur) for a fee. Note: the report is not a survey.

To conclude the sale, both parties must sign a transfer contract (akte van levering). Typically this will take place in Dutch, therefore it is advised to ask for an interpreter in advance if you feel you need one. Upon completion, the lawyer will inform the Land Registry (Kadaster) and you should get your keys within two to three months.

Steve's note: I like what I've read about Amsterdam, and I am happy to learn a bit about the real estate possibilities there, but I wish that cheap rent was available to expats as well.


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