In April 2017, we reported on plans by the municipality of Amsterdam to offer existing leaseholders the opportunity to switch to a new system of perpetual ground lease. The municipal council has now agreed to make the switch possible for leaseholders of residential properties with effect from 1 October 2017. For non-residential properties, the council has decided to leave the decision to a new municipal executive and will remain with the old system for the time being.
The main difference between the old system of permanent ground lease and the new system is that the new system no longer works on the basis of time periods (after the expiry of which the level of the ground rent payable by the leaseholder is adjusted based on the changed land value). Instead, the ground rent is determined on a once-only basis and is adjusted in line with inflation only. Any leaseholders who want to can opt out permanently from their financial obligations by paying a one-off buyout sum.
Leaseholders of residential property can, in principle, switch at any point in time. In that case, a new ground rent is determined based in part on the WOZ value of the property. The municipality of Amsterdam website features a calculation tool that can be used to obtain an indication of the costs in individual cases.