Erfpacht, or ground lease, is a legal construction in which a homeowner owns the property built on a plot of land, but not the land itself with annual fees (canon) payable to the landowner, often the Municipality of Amsterdam, subject to periodic revision.
You found the perfect apartment in Amsterdam. The price is right, the location is ideal, and the listing looks clean. Then you notice two words in the description: perpetual leasehold or leasehold bought off, yearly groundlease: Suddenly things get complicated. Erfpacht is one of the most misunderstood elements of the Amsterdam housing market and one of the most financially significant. Here is what you actually need to know.
What Is Erfpacht and Why Does Amsterdam Have So Much of It?
Amsterdam’s municipal government has historically retained ownership of a significant portion of the city’s land, leasing it to homeowners rather than selling it outright. The practice dates back to 1896 and was designed to prevent land speculation and keep housing costs manageable. Whether it succeeded in that goal is debatable, but the result is that a substantial share (70-80 %) of Amsterdam’s housing stock sits on leasehold land.
As a buyer, this means you purchase the right to use the land not the land itself. You pay an annual canon to the landowner (usually the City of Amsterdam, sometimes a private party, if that’s the case, be warned!). That canon can be revised at set intervals, and when it is revised, the new amount can be dramatically higher than what you were paying.
Amir of our team is an MVA Erfpacht Deskundige a certified ground lease specialist. That certification is not standard for Amsterdam brokers. It means he can read the fine print and tell you what a specific erfpacht situation actually means for the property’s value and your costs. See about Mr. Broker for the full list of certifications.
The Three Types You Will Encounter
Voortdurende erfpacht (continuous ground lease): The oldest type and most common. Canon is revised every 50 or 75 years. The revision is based on land value at that time, which in Amsterdam can mean a dramatic increase. Many properties with revisions due in the next decade are already being priced lower to reflect the risk.
Eeuwigdurende erfpacht (perpetual ground lease): Amsterdam’s newer system, introduced in 2017. The canon is or paid off eternally or indexed annually to inflation and is more predictable (if applicable right away). Generally considered safer for buyers, though it still means ongoing annual costs. A lot of times the continuous lease still applies, and the perpetual ground lease only starts in 20 years.
Tijdelijke erfpacht (temporary ground lease, very rare): The most complex. The lease has an end date. When it expires, the land returns to the landowner. These properties are significantly harder to finance and should be approached with extreme caution unless you have specialist advice. These days you don’t really face this situation anymore.
What to Check Before Making an Offer
Always establish: which type of erfpacht applies, when the next canon revision is due, what the current annual canon is, and whether it is already factored into the asking price. For properties with a revision coming within 5–10 years, the risk needs to be quantified before you bid. It also effects your mortgage possibly, a lot of people forget that and get surprised when they apply for the mortgage.
Properties on erfpacht are not automatically bad investments, many of Amsterdam’s most desirable apartments sit on leasehold land. But buying without understanding the specific terms is a real risk. The FAQ page covers common buyer cost questions, and Mr. Broker can review the erfpacht documents for any property you are seriously considering.
Is erfpacht bad for expats buying in Amsterdam?
Not necessarily, but it requires understanding. Eeuwigdurende erfpacht with a stable, inflation-indexed canon is manageable. Voortdurende erfpacht with a revision due soon is a financial risk that needs to be quantified. Never buy a ground lease property in Amsterdam without specialist advice.
Can I get a mortgage on an erfpacht property?
Yes, in most cases. Dutch mortgage lenders do finance erfpacht properties, but they may impose restrictions depending on the type and the remaining term. When the landlord is not the municipality, it can seriously create problems, because the terms and conditions can be not that friendly for the leaseholder and banks don’t finance at all. Your mortgage advisor needs to review the specific erfpacht conditions.
How does the canon revision work?
For voortdurende erfpacht, the canon is recalculated at the end of each ground lease period (typically 50 or 75 years) based on the current land value. In Amsterdam, this can mean the annual canon increases from a few hundred euros to several thousand euros per year. The revision date is always specified in the erfpacht documentation.
Should the asking price be lower for an erfpacht property?
It depends on the type and terms. A property with eeuwigdurende erfpacht and a predictable canon may trade at a small discount. A property with a voortdurende erfpacht revision due in three years should trade at a more significant discount. Whether the current asking price reflects the risk is exactly what Amir of our team analyses before recommending a bid.
What does MVA Erfpacht Deskundige mean?
It is a certification from the Amsterdam Brokers Association (MVA) for agents who have completed specialist training in ground lease law, valuation and risk assessment. Not all Amsterdam brokers hold this certification. Amir van Bommel at Mr. Broker does.
Erfpacht is manageable when you know what you are dealing with. If you are looking at a property and want a straight answer on what the ground lease terms actually mean f or you, get in touch with Amir.