Renting, buying, or leasing your business premises

Renting

Advantages

• You are more flexible. Cancelling a rental contract is often faster than selling a business premises.
• In principle, major maintenance costs are not for you to pay, but for the owner. Pay attention to the provisions in your rental contract, because other arrangements are also possible. Make sure you are not surprised by unexpected responsibility for maintenance costs.
• Renting puts less strain on your equity.

Disadvantages

• You do not benefit from any increase in the value of the property.
• The owner usually sets the conditions.
• The development of the rental price can be uncertain.
• Rental contracts are sometimes valid for several years and cannot easily be terminated prematurely.
• You usually need the cooperation or permission of the owner for (major) structural adjustments to the building.
• If you rent a space in a shopping centre, your rental contract can be terminated before the end of the lease if this is necessary for the renovation of the shopping centre.

Read more about renting business space.

Buying

Advantages

• You decide how long you stay in your building.
• You build up capital through value appreciation, for example for your pension.
• You have the freedom to do what you want with your property.
• You benefit from any value-enhancing investments in the property.

Disadvantages

• There is equity (private capital) in a property. You cannot use this equity for other things.
• Obtaining an insufficient mortgage can cause problems.
• You bear the costs for major and minor maintenance.
• Your property may lose value.
• It can be difficult to sell your property at the desired time and price.

Agricultural tenancy

In agriculture, we talk about agricultural tenancy or lease (pacht) instead of rent. Lease, or agricultural tenancy, is a special form of rent. The difference between rent and agricultural lease is that it concerns the use of immovable property (for example, a farm or land) for agricultural purposes. There are also a number of regulations that you must take into account when entering into such a lease agreement.

The best-known forms of agricultural leasing are:

Regular lease (reguliere pacht)

This form of leasing applies to a farm, separate agricultural buildings, or separate land. For a farm, the legal term is 12 years. For separate land or separate commercial buildings, this is 6 years. After this period, the agreement is automatically extended for a period of 6 years, unless the agreement is terminated before that. The agreement can be longer or shorter under certain conditions. Regular lease is not possible for an indefinite period. The price must meet the requirements of the Tenancy Prices Decree (Pachtptrijzenbesluit, in Dutch).

Liberalised lease (geliberaliseerde pacht)

This form is more flexible than the regular variant. There are fewer legal regulations. This form of lease is only possible with the lease of separate land. It lasts shorter or longer than 6 years.

Cultivation lease (teeltpacht)

Land can also be temporarily leased with a cultivation lease for 1- or 2-year crops that require crop rotation. This agreement is for a maximum period of 1 or 2 years. And you only have the right to grow crops on the land for a period of 1 or 2 years. Most protective provisions do not apply.

Read more about leasing, or agricultural tenancy.