Buying a house anywhere can be stressful, but buying a house as an expat in the Netherlands notches the anxiety up quite a bit. It can all seem mystifying. The rules are unknown, the borrowing limits vary and, honestly, the houses are different too.
Rijtjeshuis. Twee-onder-een-kap. Villa. Annuity mortgage. Linear mortgage.
Is your head already spinning with this vocabulary?
The good news is that buying a house in the Netherlands is pretty straightforward once you know where to start. But before you pick up your phone and fall into the black hole of house-hunting websites, there’s one thing you have to do first: find out how much you can actually borrow for a mortgage. I know the thought of money stresses people out, but knowledge is power here.
It’s a must-do, because the worst thing, other than finding out someone else bought the house of your dreams, is finding out you couldn’t have afforded it in the first place.
Don’t go shopping hungry
When I bought my first home in the Netherlands, I checked my borrowing limit before I did anything else. If I hadn’t, I would have wasted hours looking at homes that didn’t fit my budget and for which I couldn’t have gotten a mortgage. And who has hours to waste?
Here’s the thing about house hunting without a number in hand: it’s like grocery shopping while hungry. Everything looks like exactly what you “need,” and your judgment goes out the window. A clear borrowing limit keeps you from falling for a house that’s technically for sale but not actually available to you. So, find your salary slip, your spouse’s salary slip and a few other crucial pieces of information and calculate how much you can borrow.
Using De Hypotheker’s mortgage calculator, you can see in a few minutes the maximum mortgage a bank will likely lend you. It also lays out the current interest rate and one potential mortgage from its more than 40 providers.
And although knowing how much a bank will lend you is nice to know, I think the monthly payment is the most important. Knowing whether a monthly payment fits your budget is crucial. People don’t always think about it this way, but the maximum amount you want to spend per month matters just as much as what a bank is willing to lend you.
Manage expectations
You want to know the answer to this question: If a bank will lend you €600,000, do you actually want to spend €600,000 on a house?
That’s why De Hypotheker’s monthly payment calculator is also so useful. You can see what you’d actually pay per month and check whether it fits your life, not just your loan limit.
Remember this: a bank’s yes isn’t the same as your yes.
Your monthly payment depends on more than just how much you borrow. It depends on your interest rate too. With De Hypotheker, you can also easily compare current mortgage interest rates from dozens of lenders across the Netherlands.
Mortgage rates fluctuate based on several factors, and right now they range somewhere between 3.8 percent and 4.5 percent, depending on the type of mortgage and your situation. Most people can’t time their home purchase to when rates are best, but it helps to keep an eye on them once you think you are ready to buy a house.
FAQs
So, now that you know your number and you know the rate, what about everything else, like solar panels, renovations or closing costs? De Hypotheker has a helpful Frequently Asked Questions page. It’s a gold mine of information on buying a house in the Netherlands, and it covers nearly everything, including the different types of mortgages, financing solar panels through your mortgage, folding renovation costs into a mortgage and the average buyer’s closing costs.
You’re now armed with powerful information! I wish you good luck. Dive in and go wild looking for homes. Ones that are perfect for you. Ones that are perfect for your budget too.
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See more here about real estate in Dispatches’ archives.
Lane Henry is an accidental long-term expat. She is an American who came to the Netherlands for two years—or so she thought. She has now lived in the Netherlands and explored Europe for over a decade.
