Advice on buying a house (Netherlands, Amsterdam)

[bigtimespaghetti]

I'm thinking of buying a flat in Amsterdam or rather taking a mortgage out more specifically. Mortgage rates are pretty good and if I choose to I will have to invest little of my own money.

Pros:

• It's in a bustling major city
  The market seems to have bottomed and is in a small upswing
  Easy for me to get a good size mortgage
  Rates are very low
  Some tax benefits to owning
  Beats renting
  Can always rent it out fairly easily if I end up having to leave Amsterdam

Cons:

• The Netherlands has punitive yearly taxes on owning real estate
  Heavy deflation could turn the purchase sour
  If I have to rent it out the bank will likely crank my interest rate up (no point in trying to rent it on the sly, I just don't want that kind of headache)
  Somewhat hefty pricetag for intitial fees, survey ect..
  Some regime uncertainty since The Netherlands is very leftwing and has only recently liberalized parts of their property market in the past few years
  Could end up with a revalued mortgage if the single currency crumbles?

I'd really appreciate your thoughts guys, please point out any errors in my thinking or things I have overlooked... Thanks in advance!

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[CIYAM]

One thing I'd perhaps consider is the "floating houses" (assuming there are still homes available).

And when I say "floating" I mean literally floating on water (saw it on a Discovery Channel program some time back).

[bigtimespaghetti]

One thing I'd perhaps consider is the "floating houses" (assuming there are still homes available).

Probably not, too much regulation, at least in the city of Amsterdam. I will only consider brick and mortar at least for now!

[mishax1]

I've read in some local news articles that Berlin is a good option for an investment in real estate due to it's growing population and a slow construction rate..

Some articles say it was the "secret hot" real estate investors spot for the past few years and it is growing.

[bigtimespaghetti]

One more thing- I've been meaning to look at the cyclicality of housing in Amsterdam or the Netherlands, I've been unable to find up to date data on it. I'd like to compare it to stock indices.

I've found extensive historic data and some economic reports from banks, but still nothing like the raw data I can hack into a spreadsheet.

[bigtimespaghetti]

I've read in some local news articles that Berlin is a good option for an investment in real estate due to it's growing population and a slow construction rate..

Some articles say it was the "secret hot" real estate investors spot for the past few years and it is growing.

Thanks, but I live in Amsterdam

[mishax1]

Is it for living ?

[bigtimespaghetti]

Is it for living ?

Yes, I work in the centre, sorry if I wasn't clear on that.

[mishax1]

Is it for living ?

Yes, I work in the centre, sorry if I wasn't clear on that.

OK then, good luck anyway. I visited the Netherlands once and loved Amsterdam    A good friend of mine also got married to a dutch and are living there. 

[bigtimespaghetti]

Is it for living ?

Yes, I work in the centre, sorry if I wasn't clear on that.

OK then, good luck anyway. I visited the Netherlands once and loved Amsterdam    A good friend of mine also got married to a dutch and are living there. 

Thanks mishax1! I really like it here too (I'm British). I'm just still a little unsure if it's a 'good' time to buy. I suppose if it was a 'good' time I'd probably already be priced out though! I don't care about capital appreciation- it'll be a home and a very long term investment to me. But I'd rather not wipe out my finances on a silly decision too.

[countryfree]

Amsterdam's definitely a major city so it's look like a safe investment, if you can afford property tax, which can only go up.

I advise on getting a fixed-rate loan. The interest rate shall not change with your occupancy or renting. And don't worry about the euro crumbling. Your loan will not be pegged to the US dollar, nor the Swiss franc.

[bigtimespaghetti]

Amsterdam's definitely a major city so it's look like a safe investment, if you can afford property tax, which can only go up.

I advise on getting a fixed-rate loan. The interest rate shall not change with your occupancy or renting. And don't worry about the euro crumbling. Your loan will not be pegged to the US dollar, nor the Swiss franc.

Thanks countryfree. I included it last as I see the euro ending as a remote possibility, but one to at least acknowledge.

The property tax is affordable even if it's hard to swallow paying it. I'm not sure it will increase significantly though at least for the next few years.

The rate will be fixed for a minimum of 10 years. I am considering 15.

[Furio]

Is it for living ?

Yes, I work in the centre, sorry if I wasn't clear on that.

OK then, good luck anyway. I visited the Netherlands once and loved Amsterdam    A good friend of mine also got married to a dutch and are living there. 

Good taste

[Amph]

you're buying directly with bitcoin, or conveting to fiat first?

[bigtimespaghetti]

you're buying directly with bitcoin, or conveting to fiat first?

I'll be taking a mortgage out. I'm not that bitcoin-rich, so just plain old fiat based debt!

I've already sold half of my bitcoin when it became clear (even to me) that there would be a washout, which happened and now I'm waiting for the bounce that we've witnessed to terminate, to go long again.

[najzenmajsen]

i think its a good idea , ive heard good things about buying houses in amsterdam. saw some article about it while back , not sure where tho : >

[bigtimespaghetti]

i think its a good idea , ive heard good things about buying houses in amsterdam. saw some article about it while back , not sure where tho : >

From a speculative/rental property point of view it is probably a reasonably good idea. But nothing is ever certain, I am in a lucky position of having access to some favorable finance options due to my bank/job so it may be worth the risk.

[countryfree]

Besides the financial risk, you may be warned about climate change. I've seen maps where most of Holland was flooded because of rising sea levels. That could happen sometimes around year 2200. Maybe as soon as 2150.

[bigtimespaghetti]

Besides the financial risk, you may be warned about climate change. I've seen maps where most of Holland was flooded because of rising sea levels. That could happen sometimes around year 2200. Maybe as soon as 2150.

You know, that's the only factor that I have not taken into consideration. Amsterdam isn't far above sea level. But if it's one thing the dutch can do it's water drainage. Probably worth doing some research into, thanks.

[iamback]

Isn't Europe about to collapse into a Sovereign Debt collapse BIG BANG this year (or next) according to Martin Armstrong's models. In what universe would that not mean a collapse in real estate prices and an increase in taxation??

Armstrong has also written about the bubble in real estate in Switzerland. He has also written about the real estate loans throughout Europe denominated in Swiss francs, that will blow up because of the abrupt and egregious appreciation of the franc since the Euro peg failed recently.

C-O-N-T-A-G-I-O-N.

The comments in this thread are interesting because it means there are some (most?) who still don't believe the contagion will affect all of Europe (are they correct?) and thus the stampede out of Europe will be abrupt as these people wake up to a contagion and try to all exit at the same time too late.