Increasing water scarcity, climate change and urban growth are placing unprecedented pressure on potable water supplies across Europe. This paper presents a full-scale, operational case study of a water-neutral residential development in Heuvelstraat, Silvolde (The Netherlands), demonstrating how decentralised water reuse can materially reduce potable water demand while maintaining public health protection and regulatory compliance. The project integrates rainwater harvesting, greywater recycling and blackwater treatment directly into building and neighbourhood design. Rainwater is treated to drinking water quality using sand filtration, nanofiltration and UV disinfection, while greywater is reused for non-potable applications. Blackwater is treated via a compact MBR-based system with activated carbon and UV, producing infiltration water and compost while achieving high removals of organic matter, nitrogen and phosphorus. Independent monitoring confirms consistent compliance with microbiological, chemical and emerging contaminant standards, including very low nutrient and pathogen concentrations. Across 28 dwellings, the scheme demonstrates up to 40% overall water savings, with a long-term ambition of 100% drinking water self-sufficiency and only 30 litres per capita per day of potable water demand. The paper explores technical performance, governance challenges, stakeholder engagement and scalability, providing transferable lessons for utilities, regulators and developers seeking resilient, fit-for-purpose water reuse solutions to enhance water security and drought resilience.