Nearly 2 million migrants live and work in Belgium. While many of them come from other EU countries, vast numbers also originate outside the EU. For most migrants the priority is to secure earning opportunities that allow them to send remittances back to their families. Remittance services such as the Ria Money Transfer App are household names among migrant communities in Belgium. Another goal of expat professionals is to own a home. Compared to several other EU countries Belgium currently has favorable circumstances for expats to buy property. Here is a look at some of the factors that expats should consider before making a real estate investment in Belgium.
Real estate in Belgium
The property market in Belgium has seen some ups and downs. The country experienced a housing boom in 2008-2009, and property prices escalated. Since the 2008 economic crisis the prices have seen a rationalization, following macroeconomic trends. This continues to be the pattern in recent years. According to the Global Property Guide the number of real estate transactions and property values in Belgium increased gradually but continuously during each quarter of 2019. A report by ING Bank predicted 2% appreciation in house prices in 2020. However, the Belgian statistical office StatBel reported that the inflation of property prices in Q1 of 2020 was as high as 3.6%. This is lower than the last quarter of 2019 when it was 4.8%.
Statbel reported that the Brussels-Capital Region is home to the most expensive real estate in the country. 3-bedroom semi-detached houses cost as much as EUR 365,000 while 3-bedroom detached dwellings can cost up to EUR 830,000. The average property prices in the three big regions of Belgium in Q3 of 2019 were as follows: EUR 425,000 (Brussels), EUR 265,000 (Flemish), and EUR 175,000 (Walloon).
One driver of housing demand and prices has been the expansion of the mortgage market. Low interest rates along with competition among banks created more options for buyers seeking home loans. An OECD publication of 2015 stated that housing conditions in Belgium are among the best in OECD countries according to the Better Life Index. "The dwellings are of high quality and large, and housing costs are average".
Expats and property
Belgium is multiethnic and multicultural. Italians lead other EU nationalities in Belgium with a population of more than 450,000. They comprise more than 4% of Belgium's total population. Moroccans (200,000) and Turks are the major Non-EU nationalities in the country. The most spoken language in Belgium is French, followed by Dutch, German, Arabic, and many more.
There are no restrictions for foreigners against buying property in Belgium. Expats and nonresidents can buy real estate and take out mortgages. Moroccans, Turks, and other non-EU nationalities can and do buy properties. The catch is that buying real estate attracts higher taxes for foreigners than for Belgians. Depending on region a buyer must pay 10%-12.50% of the property value as registration tax. In addition there is 21% VAT, which depends on the age of the property. Finally buyers must pay 1.6% as the notary fees. Expats must also have a clean legal record to be eligible to buy real estate in Belgium.
Financing
Financing real estate in Belgium is much the same as many other EU countries. When applying for a mortgage nationality is not the most important consideration. What really counts is the financial status of the applicant. The usual arrangement in Belgium is pay 10% of property value upfront and have the remaining 90% financed via a mortgage. Buyers can get mortgages with fixed or variable rates of interest. Most have repayment durations of 10 years or longer. Banks such as ING Belgium, Citibank Europe, KBC, and others can offer expats good mortgage deals.
About the author:
Hemant G is a contributing writer at Sparkwebs LLC, a Digital and Content Marketing Agency. When he’s not writing, he loves to travel, scuba dive, and watch documentaries.
