Buying or renting: it is one of the most fundamental choices for any entrepreneur who needs commercial premises. Both options have clear advantages and disadvantages, and the right choice depends on your specific situation. In this article, we compare buying and renting on all relevant aspects — from monthly costs to tax implications — with concrete figures for the Dutch market in 2026.
Cost comparison: buying vs. renting
At first glance, buying often seems more cost-effective: you build equity rather than 'throwing money away' on rent. But reality is more nuanced. Let us place the costs side by side.
When renting, you pay:
- Monthly rent (fixed, with annual indexation)
- Service charges (variable)
- Energy costs
- Your own fit-out costs
- Security deposit (temporarily tied-up capital)
When buying, you pay:
- Mortgage payments (interest + repayment) or full purchase price
- Transfer tax (10.4% in 2026 for non-residential properties)
- Notary and land registry costs
- Maintenance and renovation (entirely at your own expense)
- Building insurance
- Property tax (owner's share)
- Management costs (if you let out parts)
The crucial difference: when renting, your costs are predictable and limited to the lease period. When buying, you have higher entry costs but build equity — provided the property value does not decline.
Financial aspects of buying
Buying commercial property is fundamentally a real estate investment. The financial considerations:
Purchase costs
On top of the purchase price come substantial ancillary costs. In 2026, transfer tax for commercial real estate is 10.4%. Including notary costs, valuation, and advisory fees, the total purchase costs amount to approximately 12–14% on top of the purchase price.
For a EUR 1,500,000 office property, this means approximately EUR 180,000 – 210,000 in ancillary purchase costs.
Financing
Banks typically finance commercial real estate up to a maximum of 70–80% of market value. You therefore need at least 20–30% equity, plus the ancillary costs. The current commercial mortgage rate in 2026 sits at approximately 4.5–5.5% for a 10-year fixed-rate period.
Equity build-up
The main argument for buying is equity build-up. With an annuity mortgage, you build equity monthly as part of your payment goes towards repayment. Additionally, you benefit from any increase in property value.
However, value appreciation is not guaranteed. The office market has cycles, and dated properties at less desirable locations can decline in value. Properties with a low energy label are particularly under pressure.
Financial aspects of renting
Renting is often seen as 'throwing money away', but that is an oversimplification. The financial advantages of renting are real:
No large start-up capital required
When renting, you do not need 20–30% equity for a purchase. Your start-up costs are limited to the deposit (3–6 months' rent), fit-out costs, and any agent's fees. This means you have more working capital available for your core activities.
Predictable costs
You know exactly what you pay each month. There are no surprises from unexpected major maintenance — that is the landlord's responsibility. The only variable is the annual rent indexation, which typically remains limited to 2–4%.
Opportunity cost of capital
The capital you do not tie up in real estate can be invested in your business. If your business generates a higher return than real estate appreciation (often the case for growing companies), renting is financially more advantageous.
Fully deductible costs
The full rental amount is deductible from profit for corporation tax purposes. When buying, only the interest and depreciation are deductible, not the repayment.
The capital you do not invest in property can be deployed for business growth — and for most entrepreneurs, that delivers a higher return than property ownership.
Flexibility and growth
One of the most important non-financial factors is flexibility. Businesses that grow, shrink, or change strategy have different accommodation needs.
Renting offers more flexibility
- At the end of your lease, you can move to a larger or smaller space
- You can move with market changes and trends (such as hybrid working)
- With a break option, you can even leave early
- You are not tied to a specific location
Buying offers more certainty
- No dependence on a landlord who may not renew the lease
- No rent increases — your mortgage payments are predictable with a fixed rate
- Full freedom to renovate and adapt the property
- You can let out surplus space to third parties
For fast-growing companies or start-ups, renting is almost always the better option due to flexibility. For established businesses with stable space requirements, buying can be more attractive.
Tax considerations
The tax treatment differs significantly between buying and renting:
When renting
- The full rental amount is deductible as a business expense
- VAT on rent is recoverable (for VAT-taxable businesses). Read more in our article on VAT on commercial property rent
- No wealth tax within the business on the real estate
When buying
- Mortgage interest is deductible from profit
- Depreciation on the building is limited to the floor value (WOZ value for own use)
- Transfer tax of 10.4% is not reclaimable but is deductible over the useful life
- On sale at a profit, you pay corporation tax on the book gain
- Possibility of a reinvestment reserve on sale
The tax advantages of renting are larger for most SMEs than those of buying, partly due to the limited depreciation possibilities on real estate.
Risk profile: owner vs. tenant
Buying and renting have fundamentally different risk profiles:
Risks of buying
- Value decline: real estate values can fall, particularly for dated properties or locations losing popularity
- Maintenance risk: all maintenance costs are your responsibility, including unforeseen repairs
- Liquidity risk: real estate cannot be sold quickly — if you need cash, a property is hard to liquidate
- Interest rate risk: if your rate is not fixed for long, rising rates can increase your costs
- Concentration risk: a large portion of your assets is in a single asset
Risks of renting
- Rent increases: annual indexation and market rent increases on lease renewal
- Non-renewal: the landlord may decide not to renew the lease
- Dependence: you depend on the landlord for maintenance and building management
- No equity build-up: your rental payments do not build equity
Worked example: 500 m² office
Let us work through a concrete example for a 500 m² office at a good location in a mid-sized Dutch city.
Scenario: Renting
- Rent: EUR 185 per m² per year = EUR 92,500 per year
- Service charges: EUR 45 per m² = EUR 22,500 per year
- Total annual: EUR 115,000
- Deposit (3 months): EUR 28,750 (one-off, refundable)
- Over 10 years (with 3% indexation): approximately EUR 1,320,000 total
Scenario: Buying
- Purchase price: EUR 1,400,000 (based on gross initial yield 6.5%)
- Ancillary costs (12%): EUR 168,000
- Total investment: EUR 1,568,000
- Equity (30%): EUR 470,400
- Mortgage (70%): EUR 1,097,600 at 5% interest
- Annual mortgage payments (annuity, 20 years): approximately EUR 88,000
- Maintenance and insurance: approximately EUR 15,000 per year
- Total annual: approximately EUR 103,000
- Over 10 years: approximately EUR 1,030,000 + built-up equity of approximately EUR 350,000
In this example, the annual costs of buying are slightly lower, and after 10 years you have built up approximately EUR 350,000 in equity in the property. However, you have had to invest EUR 470,000 in equity that you cannot use for your business, and you bear all the risks of property ownership.
When to buy, when to rent?
There is no universal answer, but the following guidelines help with your decision:
Buying is attractive if:
- You have a stable, predictable space requirement for at least 10–15 years
- You have sufficient equity without shortchanging your business
- You operate in a low-growth sector with stable accommodation needs
- You want to benefit from equity build-up and value appreciation
- You want full control over the property and renovation options
Renting is attractive if:
- Your business is growing or space requirements are uncertain
- You prefer to invest your capital in core activities
- You need flexibility to move with the market
- You want to avoid the risks of property ownership
- You have not yet built up significant equity
Whatever your choice, make sure you map out the total costs thoroughly. Renting? Then read our article on the hidden costs of renting commercial property so you are not caught off guard. Through RE-CONNECT you can also get in direct contact with landlords and sellers, enabling you to act quickly.
