Patrick (Paddy) Loftus is of Dutch-Irish descent and is third generation managing directors of this ...
So you bought a house in Amsterdam…now what?20 March 2017, by Patrick Loftus
Renthouse International was founded in 1968 and is the longest serving rental and purchasing agency in the expat market. They assist clients with the pre-rental, rental and post-rental phases of relocation.
About a decade ago, the city of Amsterdam decided to up its game and try and compete with other (bigger) European cities in the mission to lure international companies to the city.
Back then, cities like London, Paris, and Frankfurt were the safe bets as these cities could meet all of the requirements and needs of the multinationals.
About 20 years ago, the Irish government decided they wanted in on all the action, so they lowered their corporate taxes significantly. This proved to be a smart move, as there are now nearly 200.000 people employed by international companies in Ireland (2016 annual report from IDA Ireland).
The Netherlands has gone and done the same and the impact has been huge; more big companies are opting to settle in Amsterdam and the metropolitan area of "De Randstad".
Historically, Dutch governing policies have always supported independent business endeavours, so it's no surprise that Amsterdam has also become a haven for start-ups and freelancers. Further growth is expected and "Brexit" might be a contributing factor in the coming years.
Buying a house in Amsterdam as an expat
When you arrived in Amsterdam, you were probably expecting to be renting a house instead of buying one, initially. However, you may have soon discovered that several of your expat colleagues had bought an apartment because the mortgages offered by banks in the Netherlands were very attractive.
There has been a lot of demand for buying, despite there being little on offer. As a result of basic economics, prices have gone up and homeowners can feel good about their investment.
And buying a house in the capital will most likely remain a good investment, as experts have labelled the Amsterdam housing market future-proof. So, kudos to you for choosing to buy a property!
Being an expat means that you will most likely leave this town one day to either go back home or to a new work destination. But what will you do with your property once you leave? You have two good options:
› Sell your house
Your first option is to sell. It is expected that prices will remain high and the demand will continue to grow. Depending on when you bought your house, of course, this option seems like a good one as you will most likely make a profit.
As Dutch law is very specific when it comes to buying and selling, it is advisable to sell via a qualified real estate agency. The Makelaars Vereniging Amsterdam is a well-established and highly-qualified organisation, and a good starting point if you wish to venture down this road.
› Rent out your house
The second option is to rent out your place. Your target audience could either be tourists (short-term) or local/expat tenants (long-term).
Renting out your house to tourists
Amsterdam is a very popular tourist destination. By the year of 2025, Amsterdam is expecting to receive about 23 million visitors from abroad annually. Sounds good, does it not?
However, recently the city of Amsterdam has restricted the number of nights an owner can offer up their property via Airbnb to 60 nights per year.
Overall, short-term rentals (everything under 6 months) require a licence from the city of Amsterdam and they have currently stopped giving out licences. So, this leaves the option of renting out to long-term tenants.
Renting out your house to long-term tenants
As described above, there is a lot of demand for housing and this will most likely increase. So, why not put your house on the expat rental market for a stable income?
Please bear in mind, however, that other offers on the market will also increase, so the rental market will balance out a bit in the coming year.
Competing with other homeowners and how to proceed
There are a lot of investors who have bought and renovated entire apartment blocks exclusively for the expat rental market. New buildings are popping up everywhere, both for locals and expats.
The legendary Dutch point system (puntentelling) has been altered, and a lot of properties which were previously labelled as social housing can now be offered on the free market.
In short, much like the increase in demand, your competition will also drastically increase. The best way to go about this is to hire an expert agent/property manager who can advise you on how to get your accommodation rented out quickly.
When you hire an agent, your property will be offered to the right networks, targeting specific expat audiences with the aim of getting you a good return on your investment. Moreover, they know the laws concerning renting out your property when you live abroad.
Also, a few agents offer technical and financial management services, tailor-made for individual investors. Most experienced agencies work on a "no cure no pay" basis, so both you and your agent are equally motivated to get you the best deal possible!
Are you considering buying a property in the Netherlands that you will rent out once you leave?
Renthouse International is a rental and purchasing agency for the expat market and they will assist you with any questions you have. Their team of experts are friendly, multilingual and client-focused.