What is a VvE and what does it do?
A VvE is short for a vereniging van eigenaren. This is an association of sub-owners. Under Dutch law, the owner of an apartment (flat, studio or any other co-owned building that is subject to division) will automatically become a member of this association. The association of sub-owners looks after the joint interests of the owners of the apartments. It ensures that the building is maintained, cleaned, and insured. Decision-making in the association of sub-owners follows the common democratic rules. A meeting of the owners is organized periodically and every owner holds one vote for each apartment he or she owns. Most regular decisions require a majority consent (>50%). The more impactful decisions often require more than 75% of the votes.
The association of sub-owners pays its expenses by contributions it receives from all the owners. Every owners is obliged to pay these contributions. Failing to pay the contribution can eventually result in a foreclosure on the apartment. Apart from the ongoing expenses, the contributions are also used to create a fund that holds the owners’ collective savings for large scale maintenance. Owners tend to have different opinions and views about the urgency of these large scale maintenances. This is especially the case when savings are too low and maintenance is urgent. If there is a majority, owners can be obliged to make an additional (sometimes very substantial) contribution to the association of sub-owners to pay for the maintenance. Rallying for a delay of the maintenance can save you money in the short term, but in the long run it will have a negative effect on the value of the entire building, including your apartment.
If you consider buying an apartment in the Netherlands, make sure you are well informed on the affairs within the association of sub-owners. Always ask your real estate agent or another specialist for help. Most associations of sub-owners are well funded and are in a good financial shape, but make sure you do not buy yourself into one where the maintenance fund has hit rock bottom.