Investing in Rotterdam Real Estate with the Equity of your House. In Simple Terms with Calculation Example.

Current situation

• Amount of mortgage: 180,000 euros
• Mortgage costs: 700 euros per month

However, the value of your home has increased considerably in recent years.

• New value: 280,000 euros
• Mortgage amount remains: 180,000 euros

So you have a surplus value of 100,000 euros (the difference between the value of your house and the mortgage).

You want to withdraw those 100,000 euros. It will look like this.

• New mortgage amount: 280,000 euros
• New mortgage costs: 1,045 euros per month

Old monthly costs were 700 euros. An additional 375 euros is added (100,000 euros x 4.5% interest repayment-free / divided by 12 months).

Important!

• You can only withdraw the surplus value if you earn enough.
• The amount of your equity is determined by a valuation report.
• Interest-only is only possible on part of your mortgage, not on the entire amount.
• Interest rates may differ per situation.

So your monthly costs have now increased to 1075 euros per month, but you have now also received that 100,000 euros into your account.

With that 100,000 euros you want to buy 2 apartments of 140,000 euros each (together 280,000 euros). So you still need 180,000 euros.

To get those 180,000 euros, you take out an investment mortgage. The monthly costs will then look as follows.

180,000 euros x 6.8% interest without interest / divided by 12 months = 1,020 euros per month. Divide this by 2 (after all, you bought 2 apartments), then you pay an extra 510 euros per month per apartment.

Important!

An investment mortgage is different from your private mortgage.

For example, when granting an investment mortgage, your income is not taken into account, but the value and rental income of your 2 apartments.

In addition to your new extra monthly costs, you will of course also receive extra income because you will rent out those 2 apartments for 1,100 euros per month. It will look like this.

In your old situation you had to PAY 700 euros per month!

In your new situation you actually have 105 euros per month LEFT! (rental income 2,200 euros - expenses 2,095 euros)

This is a difference of +805 euros with the old situation!

This way you can also invest in real estate, without having to save for it.