Buying a house in the Netherlands: defects

A horrible scenario: you have bought a house and later discover defects and deficiencies. What to do and who is to blame? Or more importantly: who is legally responsible?

In the case of ownership of a pre-existing home, the crucial moment for liability for defects is the moment of transfer of ownership. (A pre-existing home means that you are not its first owner.) The basic rule is: once you own it, the property becomes your responsibility. However, there are exceptions to this rule.

The seller’s obligation: disclosure

Under Dutch law, the seller of real estate has an obligation to provide a prospective buyer with detailed information. This information must cover both the current condition of the property and the residential environment. Any failure to inform you of issues concerning the condition of the property or the residential environment, of which the seller was aware, makes the seller liable. This also applies to providing incorrect information.

The buyer’s obligation: examination

The seller cannot be held responsible for defects that are obvious to the naked eye. He cannot be held accountable if it the defects would have been clear had you done a more thorough examination. How thorough you are expected to be in your investigation depends on the age of property.

It is always advisable to have a structural inspection carried out and a report made up by an independent professional. If you prefer, you can find checklists on the Internet. Should you fail to fulfil your obligation to have this examination carried out, it will be difficult to hold the seller accountable later on.

In this context, the seller’s duty to disclose takes precedence over the buyer’s duty to investigate. This means that if there is a defect about which the seller should have informed the buyer, this cannot be shifted onto the buyer’s duty to investigate.

Hidden defects that impede a ‘normal’ use of the property

It is possible that a serious, previously undetected defect emerges which hinders the “normal” use of your new home. This is also the main rule: in principle, only hidden defects that interfere with the normal use of the property can be for the seller’s account, in which case only the repair costs are borne by the seller. The “new for old” rule must also be taken into account. However, if the seller has breached his duty to disclose, it may be the case that the seller is also liable for consequential damage.

Examples of defects that interfere with the normal use of the property include, for instance, draining the bathtub half a year after purchasing the house and finding that the water ends up in the living room downstairs. Another example is an unauthorised extension, which was built by the previous owner.

However, if the property is older, it may of course be the case that it contains more defects simply as a result of its age. In many cases, the contract states that the previous owner is not liable for defects caused by the age of the property. Once again, it is advisable to have a thorough inspection of the property carried out before purchase. Sometimes the purchase agreement also contains other exclusion clauses, for example in relation to asbestos or moisture problems.

Different rules apply regarding a newly built house.

Newly built house: longer warranty

In the case of a newly built house, meaning there was no previous inhabitant, the building contractor rather than the real estate seller is accountable for any defects and/or deficiencies until delivery of property. The building contractor must take you on an inspection of the property and you must sign a piece of paper that you accept the property as it is.

Before you do this, it is crucial that you have an independent professional inspect the premises and make a report. It is not unusual to find, say, 21 defects. Don’t allow yourself to be coerced into signing a so-called pre-delivery report. New issues might still pop up.

After the final delivery, the building contractor has a grace period of three months to fix everything you noted and brought to his attention. This period actually stretches out to six months (the so-called ‘maintenance’-period) for any other problems that might occur. Make sure you keep a written record of everything and inform the contractor as soon as possible, just to be on the safe side.

For hidden defects the contractor remains accountable for up to five years and for serious structural mistakes even up to 20 years. A mistake is serious when the property will collapse or is not usable for its purpose. The contractor isn’t accountable, when he can prove that he is not to blame. Nevertheless, a buyer of a newly built property has more and longer lasting guarantees and rights then a buyer of an ‘old’ house.

So, what to do in case of a defect?

When you discover a hidden defect in your house, you have two months from the moment of discovery to notify the previous owner or contractor. If he is not willing to fix the problem or compensate for the damage, there are legal options to pursue this through court proceedings.

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