Tips for buying real estate in Belgium
Before you buy property in Belgium, find out the quirks of the Belgian property market to avoid any pitfalls. [Contributed by ING Belgium]
Prices of real estate in Belgium have typically been less volatile than in other countries over the past decades. They even were largely untouched by the financial and economic crisis of 2007 – 2008. How come?
Essentially the prices of private real estate in Belgium never rose as high as in the surrounding countries. First of all because local banks typically do not lend money if more than a third of the regular monthly income of the borrower is already used for the repayment of other debts. Furthermore tax on purchase of real estate in Belgium is very high with a headline figure varying between 10 and 12.5 percent. Last but not least rent prices are not very high in Belgium because the rent market is not very large given that the typical Belgian would rather own his house than having to rent it.
The stability of the private real estate market here attracts private investors. While the taxation on purchase of private real estate is high, the taxation of the income therefrom as a private investor is typically not high if you let the property to a private person who uses the property for private purposes.
Before launching yourself in the real estate or buy-to-let markets though, it is good to learn the key characteristics.
Tips for buying property in Belgium
> First and foremost be sure about the property you want to buy and the price you want to pay for it. Belgium does not know the system of free offers you can withdraw at any time.
> Here an offer typically is binding if accepted by the selling party and it is the start of the formal buying process (compromis de vente).
> In Belgium you buy a property, save for a few exceptions, in the state it is in without recourse on the former owner. Have a real estate expert check it in detail before you sign.
> Refurbishing an old house or changing its purpose is regulated by stringent urbanisation rules you have to follow.
> A real estate company, a real estate expert and a notary are the typical parties in any transaction. The latter is mandatory, the two former ones typical. Even if the selling party has his or her own notary, you have the choice to also take a notary of your own without extra cost to the total notary costs of the transaction. Thus this it highly recommended to do so. It is also more than worth the to ask for a valuation of the property to a real estate expert beforehand. Those few hundred euros will avoid you paying too much for the property or without knowing the exact state the property is in.
> Belgian banks are typically quite willing to lend money to you for a private real estate purchase in Belgium up to about the purchase price of the property, subject to the acceptance of your credit file.
There are information seminars around to help you prepare for a smooth buying process.
Contributed by Dave Deruytter, Head of Expats and Non-Residents / ING Belgium
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