Property for sale in Belgium tends to be cheaper than nearby countries, but homebuyers should be aware of the high property transaction costs and market rules before buying a Belgian property.
Whether you’re moving to Belgium or looking for an investment or buy-to-let property, you might be tempted by properties for sale in Belgium: Belgium’s standard of living is high and Belgian property prices are relatively lower than neighbouring countries and many other European capital cities. However, high property transaction costs can offset any short-term benefits, so it’s important to be aware of the Belgian housing market quirks and regulations before buying a property.
As a foreigner, your dream home in Belgium might feel like it is hedged about with a thick bramble of bureaucracy. However, the seemingly endless contracts and red tape can be defeated, as many expats have discovered. Zabra Real Estate explains how foreigners can cut through the process of buying a property in Belgium.
Throughout this article, terms are given in both French and Flemish (Dutch) languages.
Zabra Real Estate
A family business with a long-term vision, Zabra Real Estate has 30 years of experience in residential development in Belgium. Their small, dedicated team offers a vast portfolio of properties which make beautiful homes and strong investments.
Should you rent or buy property in Belgium?
Belgian tenants have strong rights, and most expats choose to rent at least initially, especially those planning a short-term stay. Belgium’s typically long-term rental agreements (up to nine years or more) give tenants the ability to decorate and improve properties, adding certain perks to renting a house in Belgium. But if you’re planning an extended stay of more than five years, you may find security and savings in buying Belgian property.
The property markets in Brussels and around Belgium have been a picture of stability in recent years, with average house prices recording a 3.7% year-on-year increase in the final quarter of 2017, according the the Belgian statistics office. There are signs, however, that things are slowing, as the house price index decreased by 0.4% in the final quarter of 2017.
There remains a significant gap between house prices in different Belgian cities. In the third quarter of 2017, prices in the Brussels-Capital region rose by 3.47% year-on-year to an average of €429,647. In Flanders, meanwhile, there was just a 1.71% increase, with an overall average of €236,189.
High prices also seem to be putting off buyers and investors, with transaction numbers down 7.6% year-on-year, and residential construction dropping by 17%, according to the National Bank of Belgium.
The 10 most expensive municipalities to buy in Belgium were almost all in Brussels, based on the average real estate prices recorded by the Belgian statistics office: Elsene ( €617,000), Sint-Lambrechts-Woluwe, Sint-Pieters-Woluwe, Etterbeek, Ukkel (around €500,000). In 10th place came the first non-Brussels municipality, Kraainem, while Sint-Martens-Latem near Ghent ranked 11th place with an average price of €403,000. Other notoriously expensive municipalities in Flanders included Zoersel (in the Antwerp area), the upmarket seaside resort of Knokke-Heist and Leuven.
Although impossible to predict what the market will do long-term, those planning an extended stay, typically five years or more, may find owning their own Belgian home worthwhile. Anyone considering an investment of less than five years should consider Belgium’s capital gains tax of 16.5% on properties sold within five years of purchase. You can find more information on real estate, rental agencies and serviced apartments in Belgium with Expatica’s listings.
Can foreigners buy property in Belgium?
There are no restrictions to stop foreigners buying property in Belgium, even if they are non-resident, although different tax implications apply between resident and non-resident buyers in Belgium. You can read about Belgium’s visa and permits for foreigners, as well as applicable Belgian taxes and how to claim non-resident Belgian tax status.
It’s important to note that those who rent out their apartment, even temporarily on house-sharing websites such as Airbnb, must declare any income on their Belgian tax return. In 2017, the Belgian government announced it would employ processes to scan holiday-let websites in an attempt to clamp down on tax cheats. Those who fail to declare rental income risk a fine of up to €1,250 or a 200% tax surcharge. New regulations that came into force at the start of 2018 allow Belgian landlords to earn up to €6,000 tax free.
Find Belgian property for sale
Listed properties for sale are known to have negotiable prices, and the idea is to make an offer slightly below your ideal price.
Most properties for sale will have a distinct orange sign in the window saying ‘à vendre/ te koop‘, so keep a look out when walking about. Searching online is a popular way to find Belgian property for sale, and we’ve listed some major property portals below, although hiring a real estate agent can provide certain key advantages.
Estate agents may be willing to act as translators and help you understand the ins and outs of your contracts, which can be useful when regulations and processes vary between Belgium’s regions. Try to hire an agent who acts on your behalf, not the seller’s. Costs to buy Belgian property through an agent range anywhere between €250–1000, or more if extensive services are required.
If you’re looking at buy-to-let investments, the Belgian government provides a tool to calculate an estimated rental price for your property. Expatica also has a housing portal where you can find your dream home.
Buying a property in Belgium
Brush up on your terminology, or find a good interpreter, because you’ll be reading and signing a lot of documents. The paperwork tends to come in three phases:
- A commitment to buy (offre d’achat/ koopintenties), which is often requested by agents but not essential. It ties the buyer to the sale but allows the seller to back out without penalty. It is common to put down a small deposit or holding fee, which you will lose if you back out of the sale.
- The sale agreement (compromis de vente/ verkoopcompromis), which outlines the details of the contract. At this point you will usually need to pay a deposit of around 10% of the purchase price, after which you have four months to pay the remaining balance (usually via a mortgages).
- The notarized deed (acte notarié/ notariële akte), which transfers ownership of the property. This must be signed within four months of the sale agreement.
Tip: It’s important to include appropriate exit clauses, for example, one that dissolves the agreement without penalty if you are unable to secure a mortgage or if a structural survey reveals significant damage.
Legal requirements for your Belgian contracts
In Belgium most contracts must be written in Dutch or French, and it is a legal requirement that the signer fully understands the contract. This means that you have the right to bring a translator and have each clause explained in your own language.
If you’re looking for translation to English or German, you will probably be able to find a real estate agent or notary who speaks your language fluently. For other languages, you may need to hire a translator and pay the translator’s fees yourself.
Both buyer and seller must be represented by a notary. Their fees are fixed by the state as a percentage of the property purchase price. The house sale must also be registered at the registry office within four months of the purchase being complete, at which time registration fees are due.
Finance your Belgian property: deposits and mortgages
The deposit or down payment is usually 10% of the property purchase price. It must be paid into an escrow account or held by a notary, and must not be paid directly to the buyer or their agent.
Both fixed and variable rate mortgages are available in Belgium. Loans are typically fixed for a period of at least 10 years or more, as this provides a tax advantage in Belgium.
Your mortgage provider will usually insist that a professional valuation of the property is undertaken, which costs around €100-200, but note that this is not a structural survey. The valuer will focus on estimating the value of the property and may overlook or not notify you of significant structural issues. Residential surveyors are uncommon but architects in Belgium provide a similar service.
Costs of buying Belgian property
In Belgium the costs of buying a property are split between the buyer and seller, although the buyer will pay the majority of the costs, around 11–15% of the purchase price, and the seller around 3–5%. Buying a new property is more expensive for the buyer with total fees rising to around 22% for new-builds, due to different applicable tax rates.
The fees typically paid by the buyer break down as follows:
- Registration tax (old properties only) – 10% (Flanders) or 12.5% (elsewhere); ). From 1 June 2018, buyers in Flanders have seen this rate cut to 7%. For homes priced up to €200,000, buyers don’t need to pay fees on the first €80,000 and get an extra discount of €5,600.
- VAT at 21% (new properties only) – Value Added Tax is charged on properties less than two years old.
- Notary’s fee – 0.2% to 4%, a fee fixed by law that depends on the purchase value; You can get an estimate of how much you’ll need to pay in notary fees on the Royal Belgian Notariat Federation website
- Cost of deed of sale: €800–1,000;
- Real estate agent’s fee: 0.2–0.6%.
Why are new Belgian properties subject to extra charges?
VAT is charged on any Belgian property that is less that two years old, even if it has been lived in before. A property’s age is up when it reaches the second 31 December after it was first inhabited. This means that if a property was moved into any time in 2015 it will count as ‘new’ until 1 January 2018.
Although VAT is payable if the property is classed as new, the buyer does not have to pay registration tax, which is only applicable to properties older than two years.
Lower registration tax
All Belgian properties have an assigned value called a revenu cadastral/kadastral inkomen. While this typically relates to the rental value of the property in 1975, it’s easier to treat it as an arbitrarily assigned score.
If you are buying a low scoring property, i.e. one with a or revenu cadastral/kadastral inkomen below a fixed amount, then registration tax is reduced to 6% when buying a Belgian property. These reductions do not apply in the Brussels region.
The Flemish region has overhauled this outdated system, however. Buyers in Flanders previously had their fee cut to 5% – but since 1 June 2018 that fee has risen to 7%. Buyers purchasing cheaper homes (under €200,000) don’t have to pay on the first €80,000 and get an extra discount of €5,600.
Tax deductions for buying Belgian property
A tax break of up to €2,000 is available for homeowners with a mortgage. The exact amount depends on several factors including when your loan was initially set up, the number of children you have and the amount of interest due.
However, this is balanced somewhat by an annual tax on the estimated rental value of your Belgian property (even if it is owner-occupied) of between 1.25 and 2.5%. The modern rental value is calculated by multiplying the 1975 value, the revenu cadastral/ kadastral inkomen, by a standard figure set by the government.