Immoweb, one of Belgium’s largest online real estate platforms, suggests that Belgian buyers are increasingly unable to afford large houses and apartments. According to a recent report published by the company, one habitable square metre of real estate in Belgium now costs an average of €2,221 – €96 more than in January.
As such, on average, Belgians can afford 11% less space than just half a year ago. “At the beginning of the year, an average Belgian could afford 79 square metres; today it is barely 70 square metres.”
The findings are another example of the declining purchasing power of many Belgians. The report notes that the rising cost of real estate, alongside evolving credit conditions, have had a “significant impact” on household budgets.
Borrowing rates for prospective Belgian homeowners have also become less favourable. Fixed interest rates for 20-year mortgages rose from an average of 1.5% in January to 2.4% in June. This has led to a “sharp contraction in the borrowing capacity of households,” Piet Derriks, managing director of Immoweb, noted.
Less, for more
Brussels remains the most expensive real estate market in Belgium. The average price of one square metre of real estate in the capital is €3,300 – 48% more than the national average and 42% more than in Flanders. Wallonia remains the most affordable region to purchase real estate, costing just €1,677 per square metre.
In Flanders, Flemish Brabant is the most expensive region at €2,501 per square metre. At €1,877/m2, Limburg is a more affordable investment option.
In Wallonia, Walloon Brabant is the most expensive (€2,429/m2). Hainaut is the most affordable at €1,431/m2.
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The data also shows that the popularity of city living has returned. During the pandemic, Immoweb observed an exodus of homeowners to the countryside. However, 2022 has seen a 4.9% increase in urban price increases compared to 3.7% in rural areas. Likewise in Wallonia, city prices increased 3.3% and countryside prices by 2.7%.
It isn't only for buyers that prices are rising. In January, Daweale Real Estate Group concluded that rents in Brussels and Flanders had reached all-time highs, averaging at €846 in 2021.
“The supply of rental houses cannot keep up with demand, pushing up house rental prices,” real estate expert Filip Dewaele noted.
Since 2019, Brussels has been in a “major housing shortage.” During the pandemic, construction of new houses in the capital fell to record lows and many Brussels residents at risk of poverty now live in housing considered “too cramped in relation to the size of their household.”