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Purchase Agreements

Purchase Agreements

A purchase agreement for a house is also called a "preliminary purchase deed". Entering into this agreement is a first, and very important, step in obtaining title to your desired house.

However, the word "preliminary" is somewhat misleading as this means that there is now a final written agreement between the parties about selling and buying the house. Here the word "preliminary" only refers to the fact that a deed of transfer will follow after the purchase agreement.
This deed of transfer is the second step and through this deed, title to the house is transferred to the buyer by the seller, after which the deed of transfer and the actual transfer of title is registered in the Land Registry (Dutch Kadaster). The new owner is then identified in the Land Registry. This completes the transfer of title and the buyer is now the owner of the house.
So in summary, obtaining ownership of a house consists of three steps, as explained above: the purchase agreement, transfer of title, and its registration in the Land Registry.
A Dutch notary will already be involved in this process as an expert at the phase when the purchase agreement is entered into. In this agreement, the parties agree that the house will become the buyer's property through the deed of transfer of title, under certain conditions, as stated in the agreement, for a certain price and at the date agreed.
If the purchase deed is drawn up without involving a notary, there is a risk that important legal details, e.g. soil contamination, are not covered. Other such details are the conditions precedent, e.g. the agreement that buyers can undo the purchase transaction if they cannot arrange sufficient funding within a certain period of time. Or if they do not get the housing permit that is required in some municipalities when buying a house below a certain purchase price or that has never been issued for a garage that has been rebuilt to create an apartment.
Servitudes are one of the details that need to be considered here as well. Servitudes are rights that form a limited invasion of one's property rights, for example a right of way enjoyed by the neighbours. And special stipulations may be important for the buyers as well, such as sales-regulating stipulations or a right of first refusal when a house is put up for sale.
It is these very aspects that can be a reason to buy or not buy a house and exactly why a notary should be engaged, preferably before signing the purchase agreement. And if the agreement has already been signed, a notary can remind the parties of any risks and insecurities that exist and that the parties must still consider and arrange.
Notaries offer all the necessary expert legal assistance and advice. And as independent counsellors they are always mindful of the interests of all parties involved.


Hans and Margaret buy their dream house

Hans and Margaret buy their dream house

When walking through the woods one day, Hans and Margaret see a beautiful old farm building, half of which is for sale. This is a chance of a lifetime and they decide that they will make their dream come true.

But Margaret and Hans should be careful!
They should make sure that the ground of the farmyard and the large orchard at the back of the house are not polluted and that there are no Asian long-horned beetles in the beams etc. While it is true that the seller has a duty to give the buyer all relevant information about the house, it never hurts to consult with the local council and find out if a soil examination is necessary. If this is the case, is does not take much time to have a report drawn up by an independent third party. And you would also need advice as to how the practical and legal implications of any pollution found can be solved between the parties.
And what about designated use? Houses are sometimes split up and renovated at the owner's initiative without the relevant residential permit having been issued. You should discuss this with your notary and make sure that this is properly investigated before you sign the purchase deed. The notary can then include a condition precedent in the purchase deed stating that the transaction can be revoked if such permit has not been granted. And before buying a house, check whether you are entitled to any government subsidies or grants, especially if this is a listed building.
Other things that can be checked via the notary are the land registry or the title of ownership and whether there are any special charges and restrictions, such as for example, rights of way or other servitudes.
Also if there is any reason to expect that the Building and Housing Inspectorate may demand that improvements must be made to the house, then the notary can have these included in the purchase deed so that such costs will be at the seller's expense. The notary will also check that the seller is actually authorised to sell the property and will also point out other relevant issues.
If all these questions can be answered positively, Hans and Margaret will not just buy their dream home, but will have a real thatch roof over their heads, just like in a fairy tale!

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