The cost of living in the Netherlands has risen steadily in recent years, especially since the adoption of the Euro in 2002. However, in comparison with many other European countries - such as the UK - it still offers a relatively cheap lifestyle. Property prices and rents can be high in the larger cities, mainly due to the country’s large population and relative lack of affordable housing. The Netherlands also has some of the highest income taxes in the world, with top earners paying up to 52% above the tax threshold. However, the average monthly salary of €2178 (£1,533.37) after tax is correspondingly high and expats moving to the Netherlands will enjoy an excellent standard of living.
Property prices in the Netherlands have fluctuated since the global economic downturn in 2008 and with such a dense population, competition for attractive homes is fierce, particularly in Amsterdam and The Hague. There are no restrictions on foreign nationals purchasing property in the Netherlands, however getting a mortgage may be difficult for first-time buyers on middle to low incomes.
Although the Dutch are a nation of homeowners, the majority of expats moving to the Netherlands choose to rent a property. Rental prices have rocketed in recent years, due to the market being flooded by residents who now cannot afford to buy. A small one bedroom apartment in the centre of Amsterdam can set you back around €1,215,93 (£850)/month. Again, with a lack of affordable rental properties available, many are taken before they are even advertised. The best way to find a rental property is through an estate agent used to dealing with expats such as Perfect Housing or Funda.
Most landlords ask for a security deposit (borg) of one to two month’s rent. Tenancy agreements can be indefinite or for a fixed time period. The tenant usually has to give one month’s notice before leaving the property.
There are a variety of property taxes homeowners must pay, such as the real estate tax (onroerendezaakbelasting) which is based on the value of the property, the refuse collection tax (afvalstoffenheffing – AFV) and two water taxes covering maintenance and a pollution levy. For renters, these taxes are divided between the landlord and tenant or paid wholly by the tenant.
The cost of utilities in the Netherlands depends on your usage, but prices are high in comparison to other European countries. The energy market was privatised in 2002 and there are a number of companies to choose from, most offering combined gas and electricity packages. The exception to this is water, where each property has a single designated supplier. Access to the internet is widely available in the Netherlands and most communications companies offer a range of broadband, phone and TV packages.
The basic cost of utilities (gas, water, electricity, refuse) for an 85m² apartment is around €162.74 (£114) per month. Broadband, phone and TV packages start at around €27 (£19) per month.
There is no TV licence fee in the Netherlands, although public channels are limited. Since 2000, The Netherlands Public Broadcasting has been funded by government subsidy and advertising. Most households now opt for cable or satellite TV.
Healthcare and medical costs
The healthcare system in the Netherlands underwent major reform in 2006 and is now funded entirely through private insurance. This is in stark contrast with most other European countries, where funding for healthcare is based on a national health system or single payment. However, the standard of Dutch healthcare is exceptionally high and insurance companies are tightly regulated by the government. Health insurance is mandatory for all residents and is divided into two levels:
- Zorgverzekeringswet (Zvw), often called ‘basic insurance’ and covers standard medical care.
- Wet Langdurige Zorg (WLZ) covers long-term nursing and care.
Private insurance companies in the Netherlands must offer a core universal package for primary care, which includes the cost of all prescription medicines. The cost of a basic insurance package is around €100 (£70) per month with another social healthcare contribution taken from income. Whether to take out Dutch health insurance depends on the length of your stay. Those from the EU can access emergency treatment through a European Health Insurance Card (EHIC) and expats from outside the EU must have a private international health insurance policy. Expats (EU and Non-EU) are required to take out a mandatory Dutch healthcare policy on becoming resident in the country. For more information consult the Dutch government website here.
The Netherlands has a wide variety of large department stores and supermarket chains, as well as specialist independent retailers, which are often more expensive. As well as Dutch supermarket chains such as Albert Heijn and Vomar, you will also find the German discount stores Aldi and Lidl. Major UK food and clothing retailer, Marks and Spencer, also have branches in Amsterdam, The Hague and Utrecht. Most Dutch people like to shop for their groceries each day at independent cheese, bread or butchers shops and browsing some of the Netherlands’ many delicatessens is a good way to spend a Saturday! The cost of groceries is low in comparison to some Western European countries such as the UK and France. Shoppers should be aware that stores are generally open until 6pm, with very limited hours on Sundays.
The Dutch VAT or sales tax rate for most goods and services is currently set at 21%. For some goods and services, a reduced rate of 6% applies.
- Rent 1-bedroom apartment in city centre – €868.75 (£609.32)
- Rent 1-bedroom apartment outside city centre – €642.77 (£450.82)
- Price of apartment per square metre in city centre – €3013.64 (£2113.70)
- Price of apartment per square metre outside city centre – €2122.62 (£1488.75)
- Loaf of bread – €1.26 (£0.88)
- Milk (1 litre) – €0.89 (£0.62)
- Bottled water (1.5 litre) – €0.89 (£0.62)
- Draught beer (0.5 litre) – €0.90 (£0.63)
- Packet of cigarettes – €6.00 (£4.21)
- Petrol (1 litre) – €1.60 (£1.12)
- Cinema ticket – €10.00 (£7.01)
Source: www.numbeo.com (accessed December 2015)
Budgeting and Savings
There are a number of price comparison sites which help consumers save, such as Verelijk. Food shopping at discount supermarkets such as Aldi or Lidl, and renting an apartment outside of city centres can also significantly cut costs.