Differences between residential and buy-to-let mortgages:

An investment mortgage (buy-to-let mortgage) works differently than a residential one.

  • A residential mortgage is for individuals who plan to live in the property. Residential buyers can get a loan of up to 100% loan to value.

  • A buy-to-let mortgage is for individuals who plan to buy a home as an investment. A rule of thumb is that investors can get a mortgage up to 70% loan-to-value (LtV).

Buy to let requirements 2024
  • You must contribute 30 % of the property price from your savings or equity from an existing property.

  • You need to be registered and live and work in the Netherlands.

  • You must pay 10.4 % of the transfer tax and other closing fees (real estate agent, valuation report, notary, translator, and mortgage brokerage fees).

Buy-to-let mortgage conditions: 
  • Suitable for long-term rent.

  • No short-term rentals, holiday homes, or Airbnb.

  • Owners of investment properties are not allowed to live in the property as residents. 

*If you plan to live in the buy-to-let property as an owner, you must refinance your mortgage to a residential mortgage.

Purchase protection act

Dutch cities introduced a new law to prevent investors from taking away homes for first-time home buyers. You must meet the requirements if you want to invest in a property.

This law only applies to those buying properties for investment purposes. However, there may be restrictions for homebuyers who wish to rent out their property, such as needing a permit and meeting certain conditions. Each municipality has the autonomy to implement its own policies. Check the requirements per municipality below.

Schedule a free call with our buy-to-let mortgage specialists
  • Access to a trusted network.

  • Highly competitive rates and flexible terms.

  • Guidance through the entire mortgage process.

  • English translations of bank documents are shared.

The process of buy-to-let mortgages: 
  • Dutch mortgage lenders review the property you plan to purchase. A valuation report is required to determine the property's value, market value, and expected rent.

  • Mortgage lenders check if VvE is healthy.

  • Rent is always a key indicator when applying for a buy-to-let mortgage.

  • Mortgage lenders check your income and savings to determine how much mortgage you can afford.

Buy-to-let mortgages lenders
  • Mortgage lenders have different requirements to apply for investment mortgages.

  • The buy-to-let market is small in the Netherlands. Only a few lenders offer investment products: Dynamic Credit, Nationale Nederlanden, Rabobank, Lloyds bank, NIBC, De Nederlandse, Domivest, RNHB and Woonfonds.

  • Mortgage lenders work only with mortgage brokers. Please contact us for investment opportunities in the Netherlands.

  • Not all buy-to-let mortgage products are available for internationals (expats).

  • Higher interest rates apply to investment mortgages.

Buy-to-let mortgage calculation

Banks and mortgage lenders have different requirements and calculations to determine how much you can borrow. There is no online calculator that can calculate how much buy-to-let mortgage you can afford. For this reason, please contact us to receive a mortgage report which is based on your situation.

Topics to think about
  • The value of the property can increase or decrease depending on the market.

  • Return on investment increase or fall depending on the market.

  • Tenants' rights are well-protected in the Netherlands, which means you must comply with Dutch tenancy rules.

  • Property maintenance costs.

  • Impact on income tax box one/two or box three.

Box 1/2 and Box 3 investment mortgage

Residential homeowners with a mortgage are taxed in Box 1, while property investments are taxed in box 3. The Netherlands doesn't have a capital gains tax. So rental income is not taxed if the property is in box 3.
If you buy the property as a real estate BV, the situation changes—for example, a capital gains tax as it becomes part of the BV profit.

Buy-to-let mortgage interest rates

Buy-to-let mortgage products are less popular than owner-occupied homes. The interest rates are usually higher by 0.75% to 1.25% in comparison to residential mortgages. Mortgage interest rates vary per mortgage lender in the Netherlands.

Before investing in real estate, ask yourself:
  • What type of property do you want to buy (new project, luxurious apartment, student apartment)?

  • What rent do you expect?

  • How much profit do you expect to get after taxes?

  • Research the neighborhood and WOZ value. Find out how much rent cost in a similar area.

  • How will you cover maintenance expenses?

  • Do you have plans to hire a company to manage your property?

  • How do you plan to cover monthly mortgage payments if you cannot find new tenants?

How do you refinance a residential mortgage to a buy-to-let mortgage?

Let's say you took a residential mortgage some time ago. Now you plan to move away from the Netherlands, and you want to rent your property out. Your current mortgage lender does not offer investment products, so you must switch mortgage lenders. Note: not all mortgage lenders offer an investment product in the Netherlands. Only a few lenders, like ( NIBC, Nationale Nederlanden, or Dynamic Credit, offer buy-to-let mortgages. For more information, please contact us.

Mortgage penalty

If you plan to switch mortgage lenders, you usually pay the prepayment penalty to your current lender. The prepayment penalty depends on:

  • The duration of your fixed term

  • Fixed interest rate

  • Difference between your interest rate and current interest rates

  • Mortgage lender terms

Meet the team
Sezer Yilmaz
Egle Kemezyte
Growth Marketer
Lisa Grondsma
Financial Specialist
Robin Uijtdehaage
Client Director & Financial Specialist