All sources have been thoroughly verified for credibility. Furthermore, an industry specialist has reviewed and approved the final article.
Everything you need to know is included in our Belgium Property Pack
Are you thinking of investing in property in the land of Chocolates? Are you wondering if the prices are adequately positioned?
Market timing is a subject where people have different perspectives. Your Belgian friend might tell you that now is the ideal time to buy property, while your colleagues in Brussels may think that prices will soon decline.
At Investropa, when we create articles or update our pack of documents related to the real estate market in Belgium, we use factual data and statistics to analyze information, minimizing biases and uncertainties caused by opinions.
We have carefully gathered and analyzed official reports and government website statistics. Using this information, we have created a reliable database. Here's what we found that can help you decide whether it's a good time to buy real estate in Belgium.
We hope this article proves valuable to you.
How is the property market in Belgium now?
Belgium currently stands out for its remarkable stability
Positive
Stability is the first indicator to look at because it offers a solid foundation for property appreciation and reliable returns on investment in real estate. It is an information you need as a foreigner buying a property in Belgium.
You probably already know that Belgium is a very stable country. The last Fragile State Index reported for this country is 30.3, which is an exceptional number.
Belgium's remarkable stability is largely attributed to its well-established federal system, which effectively balances power among its diverse linguistic and regional communities, thereby mitigating potential conflicts. Additionally, its strong economic performance, characterized by a robust infrastructure and a strategic position within the European Union, further reinforces its stable political and social environment.
Now, let's examine the predictions for the economy.
Belgium will keep growing steadily
Positive
Before buying real estate, check the economic viability of the country.
Based on the IMF's outlook, Belgium will end 2024 with a growth rate of 1.2%, which is not bad. As for 2025, the experts say 1.2%.
This steady growth might keep going since Belgium's economy is expected to increase by 5.9% during the next 5 years, resulting in an average GDP growth rate of 1.2%.
A moderate growth rate in Belgium suggests a stable and predictable property market, reducing the risk of sudden price drops and making it a safer investment. Additionally, steady growth can lead to consistent rental income and potential appreciation over time, benefiting long-term investors.
Now, let's delve into other metrics worth exploring.
Belgian business owners don't have faith in the economy
Negative
While it's worth considering the GDP forecast, it's crucial to keep in mind that it's produced, as mentioned, by the IMF, which is a foreign institution, thus not representing the views of people in Belgium about their own economy. Luckily, in Belgium there is an official metric that is frequently communicated. This doesn't apply to every country, so we're in luck.
The Business Consumer Index (BCI) is a metric that assesses how optimistic business leaders are about the current and future state of the economy. Surveys and assessments are conducted to obtain this data.
The National Bank of Belgium's data indicates that the Business Confidence Index is currently -13 for Belgium. To help you with interpretation, a pessimistic outlook is typically associated with a negative BCI score.
This is not new, business operators were not confident 12 months ago either. The BCI score, back then, was at -14.
The negative Business Confidence Index in Belgium can lead to a subdued property market. Economic uncertainty may result in reduced investment and slower property price appreciation. Buyers might encounter limited options in terms of available properties and potentially experience a decline in demand, creating a challenging environment for property purchases.
Belgium is providing less building permits
Neutral
If you're contemplating purchasing property in a country, it's advisable to consider the number of construction permits granted. More building permits being delivered suggests an increased belief in the positive trajectory of the property market.
Unfortunately, the number of building permits granted is falling in Belgium.
In the past year, according to Statistics Belgium, the number of building permits delivered by the Belgian municipalities fell by 3.5%, from 31,718 to 30,615 units.
Clearly, this is a negative sign. Let's explore further data.
One last point to consider - a decline in building permits directly affects the availability of properties. In such a situation, it is probable that housing prices will see an increase in Belgium in 2025.
Belgium's property prices are steadily climbing to new heights
Positive
Belgium's home prices have increased by 26.1% in 5 years according to eurostat.
It means that if you had bought a townhouse in Brussels for $500,000 five years ago, then it would now be worth around $631,000.
Currently, the real estate market is experiencing a pleasant and consistent growth in property prices, indicating a stable and positive trend.
Who doesn't like a steady growth? While buying property in Belgium at a discounted price might not be feasible at the moment, you might be banking on a favorable trend that promises long-term benefits.
You can find a more detailed analysis of the real estate prices in our property pack for Belgium.
Everything you need to know is included in our Belgium Property Pack
Belgium's population is growing and getting (a bit) richer
Positive
When you're looking to buy real estate, population growth and GDP per capita deserve careful consideration because:
- a growing population means more people needing homes
- a higher GDP per person means people have more money to spend on housing (which can lead to increased property value over time)
In Belgium, the average GDP per capita has changed by 4.0% over the last 5 years. Though not substantial, there is still a positive trend of growth. Furthermore, the Belgian population is growing (+3% in 5 years).
This means that, if you purchase a renovated townhouse in Brussels and rent it out, you will find that each year, you'll attract more tenants with sufficient funds to cover the rent.
If you're considering purchasing and renting it out, this trend is a good thing. Then, the demand for rentals is likely to go up in Belgian cities, such as Brussels, Antwerp, or Ghent in 2025.
Properties promise modest rental yields in Belgium
Neutral
Rental yield is a common factor considered in real estate investing.
It is the annual rental income generated by a property divided by its purchase price or market value. For instance, if a property in Belgium is purchased for €300,000 and generates €18,000 in annual rental income, the rental yield would be 6%
Based on the data provided by Numbeo, rental properties in Belgium promise gross rental yields from 3.2% and 5.9%. You can find a more detailed analysis (by property and areas) in our pack of documents related to the real estate market in Belgium.
It suggests a satisfactory level of income relative to the property's value.
As previously observed, the supply of real estate will remain constant, indicating that property prices are unlikely to change. However, there might be a slight growth in the number of affluent tenants. Consequently, rental yields might increase in Belgium in 2025.
Everything you need to know is included in our Belgium Property Pack
In Belgium, inflation is anticipated to be minimal
Neutral
Inflation is the erosion of the value of money.
It's when your typical plate of Belgian fries costs 4 euros instead of 3 euros a couple of years ago.
If you're considering investing in a property, high inflation can bring you several advantages:
- Property values tend to increase over time, leading to potential capital appreciation.
- Inflation can result in higher rental rates, thereby increasing the cash flow from the property.
- Inflation reduces the real value of debt, making mortgage payments more affordable.
- Real estate can act as a hedge against inflation, preserving the value of the investment.
- Diversifying into real estate provides stability during inflationary periods.
As per the IMF's forecasts, the inflation rate in Belgium will increase by 1.0% over the next 5 years, with an average annual increase of 0.2%.
It means that Belgium is expected to have near-zero inflation then. Prices won't rise and then your property investment may not appreciate.
Is it a good time to buy real estate in Belgium then?
Time to conclude !
Belgium currently stands out for its remarkable stability, making it an attractive option for property investment. The country's economy is expected to grow by 5.9% over the next five years, resulting in an average GDP growth rate of 1.2%. This moderate growth rate suggests a stable and predictable property market, which reduces the risk of sudden price drops. For potential buyers, this means a safer investment environment where property values are less likely to fluctuate wildly, providing peace of mind and a solid foundation for long-term financial planning.
One of the key factors contributing to the stability of Belgium's property market is the limited issuance of building permits. With fewer new properties being developed, the existing real estate market is less likely to become oversaturated. This scarcity can drive demand, leading to steady increases in property prices. For investors, this trend indicates potential appreciation over time, making it a wise decision to consider purchasing property in Belgium before prices climb even higher.
Belgium's population is not only growing but also becoming slightly wealthier, which can further bolster the property market. As more people seek housing and have the financial means to invest in real estate, demand for properties is likely to remain strong. This growing demand, coupled with limited supply, can create a favorable environment for property owners, ensuring consistent rental income and the potential for property value appreciation. For those looking to invest in rental properties, Belgium offers promising gross rental yields ranging from 3.2% to 5.9%, according to data from Numbeo.
Moreover, Belgium's inflation is anticipated to be minimal, which is another positive factor for property investment. Low inflation helps maintain the purchasing power of rental income and ensures that property values are not eroded over time. This economic stability, combined with the other factors mentioned, makes 2025 a potentially excellent time to buy property in Belgium. Investors can look forward to a stable market, consistent returns, and the possibility of long-term growth, making it a compelling opportunity for those considering entering the real estate market.
We wish this article has been of help!. If you need to know more, you can check our our pack of documents related to the real estate market in Belgium.
-Will real estate prices go up in Belgium?
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.