The 2020 lockdown didn’t trigger the feared real-estate crisis in Belgium. Although the total number of property transactions was down slightly on 2019 (-2.7%), prices rose sharply in every region and especially in Brussels. The first quarter of 2021, meanwhile, has already seen a return to pre-Covid peaks, with demand frequently outstripping supply. Persistently low interest rates and the search for attractive capital gains mean that real estate is a more popular investment than ever.
Market prices in Brussels
Even though Brussels experienced the sharpest fall in total property sales in 2020 (-4.8% compared to a national average of -2.7%), prices in the capital continued to rise, especially those of apartments. The average price of a house increased by 4.4% to 499 488 euros (national average: 276 993 euros), while that of an apartment soared by 8.1% to 274 382 euros (national average: 244 112 euros). That’s a significant fact when you bear in mind that – unlike the rest of the country, where house sales tend to dominate – almost 63% of property transactions in Brussels involve apartments.
In other words, Brussels remains the region with the highest prices in Belgium, especially when it comes to flats. What’s more, a three-bedroom apartment in the capital costs 35% more than one with two bedrooms – a national record!
In the space of five years (2016–2020), apartment prices have risen 20.8% in Brussels, while houses are 13.6% more expensive: an attractive return, even after adjusting for 8.6% inflation!
The most expensive neighbourhoods in Brussels are Ixelles, Uccle, Woluwe-Saint-Pierre and Etterbeek, each of which features in the national top ten.
For more information on the property market, check the ‘Notary Barometer’ (French).
How to buy?
Would-be buyers have several options: private sale, public sale or online sale.
In the case of a private sale, the vendor and buyer agree the price of the property, at which point the sale is fixed. They sign a preliminary purchase agreement which, following the necessary checks, is then finalized in a notarial deed. On top of the agreed purchase price, the buyer has to pay registration duties (12.5% in Brussels), as well as notary’s fees and administrative costs, making a total of 14–15%.
Public and online sales (www.biddit.be) are auctions overseen by a notary. If accepted by the seller, the highest bid seals the purchase. Once again, you have to add a flat fee of about 14–15% to the purchase price. Not only are sales like this safe and free of surprises, they also have the advantage of being simpler and faster (in the case of an online sale, it only takes a few weeks to become the new owner).
One thing you always have to keep in mind is that, regardless of your chosen formula, as soon as you sign a preliminary agreement or submit an offer, you are making a binding commitment to the vendor. So before you embark on this adventure, you really need to know how much you can afford.
If you use the online simulation tool offered by KBC Brussels, you’ll know in just 15 minutes whether or not your project is affordable:
How to finance your purchase?
Even if you have your own funds, it is always advisable to finance at least part of your purchase through a loan (in the shape of a mortgage). This has several advantages:
- You retain a financial buffer to deal with unexpected events or investment opportunities.
- The interest payments on your mortgage loan are tax-deductible.
- Interest rates are at historically low levels in 2021.
As the Brussels experts, we can offer you personalized advice on the best KBC Brussels mortgage to finance your purchase of a property in the capital.
Grants and subsidies in Brussels
Various subsidies to help you achieve your real-estate plans are available in the Belgian capital. Each depends on your specific situation and the nature of your project. Here are the main ones:
Tax relief on first 175 000 euros
Subject to certain conditions, you can receive tax relief in Brussels on the first 175 000 euros of the price of your property. You don’t have to pay registration duties on this tranche, which means you save 21 875 euros. To qualify, the property must be located in Brussels, it has to be your principal residence as a natural person for five years, you mustn’t own any other property, and the price may not exceed 500 000 euros.
More info: Tax relief – Bruxelles Fiscalité (fiscalite.brussels) (French)
If you’re planning to renovate your property, the Brussels Capital Region offers a whole series of subsidies relating to the stability and security of the building and to home improvements. Depending on your income and the condition of the property, these can range from 30 to 70% of the cost of renovation. The application must be submitted before the work begins.
More info: renovation-notice.pdf (logement.brussels) (French)
If your renovation improves the property’s energy-efficiency (insulation, replacement boiler, etc.), you can request a subsidy covering up to 70% of your costs. Unlike the renovation subsidy, this grant can be applied for up to 12 months after the work is carried out.
More info: Energy subsidy 2021 | Bruxelles Environnement (French)
Exterior renovation grant
A special renovation subsidy for the exterior of your property covers 30–80% of your costs, depending on your income and the building’s location.
More info: notice-exterior-renovation.pdf (logement.brussels) (French)
Reduced VAT for demolition/rebuilding
If you have a new property built, the VAT payable on the work will be 21%. However, if you demolish an existing building to construct a new one on the same plot, the Brussels Capital Region has decided to reduce the VAT rate to 6% until the end of 2022, subject to certain conditions.
More info: new measure for demolition-rebuilding (French)