Expected Returns

Whether a buy-to-let rental property is a good investment for you depends on whether you can meet the mortgage conditions, how much of your own savings you have available and if you are prepared for the financial management that is required. The returns on investment in the Netherlands are not generous but they beat those in many other countries, especially given the excellent security of the Netherlands, its stability, rule of law, generally vibrant economy, and good long-term prospects.
In average, rental gross yields are around 3-6%. Net yields are typically lower for 0.5% (repair costs, ground rents, estate agents fees).

Restrictions. Social housing or free-sector

In the Netherlands, housing is divided into two sectors: social housing and the free sector (private housing). To determine the value of the property (and thereby the rent), social housing in the Netherlands uses a points system. Points are awarded for the size of the house, the facilities, and whether the house is self-contained or not. The rent is then based on the number of points the house attains. If house has less than 143 (2018) points, it goes to social housing sector and maximum rent price is limited by law (4.8e per 1 point). In free sector tenant and the landlord have more freedom when it comes to the rent and the services provided.
Chart below shows the number of points for houses with different price(WOZ), size, and facilities ( Good: Energy Label "B", balcony or garden, bathroom with bath and shower; Poor: Energy Label "E", shower only, no balcony, no garden):

Points chart


Monthly rent that you receive from tenants is tax-free. The property is taxed as wealth tax according to common tax rules for Tax Box 3. It has progressive tax rates(2018):

Asset value Tax
Up to €75.000 0,80%
€75.000 - €975.000 1,36%
Over €975.000 1,61%

The Dutch tax office will deduct the mortgage from asset value and the balance is taxed only.

Requirements for a buy-to-let mortgage

You will either need to have Dutch nationality or you need to be registered in the Netherlands. Your financial situation needs to allow you to pay for your owner occupied or rental place as well as your buy to let property. Sometimes it’s possible to also take potential rental income into consideration. Usually, asked downpayment is between 15-40% of property price. The interest rate is about 0,5-1 percent higher than that of standard mortgages.

House Price Trends

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