With the eyes of the world fixed on the Middle East and the grim turmoil unfolding, many in Brussels will have overlooked Saturday's significance for renters – who make up more than 60% of the capital's residents.
As inflation has chewed away at purchasing power over the past year, this group has been spared the most significant erosion of disposable income by a limit that prevented rent indexation for properties without sufficient energy efficiency certificates. Introduced 14 October 2022, the measure represented a major safeguard against what in most cases would be the biggest hit to personal finances.
The protection in Brussels followed similar legislation in the other regions, which also lasted only one year despite ardent campaigning for an extension from tenants' associations. Prolonging the indexation freeze was not without political support, most notably from the region's Secretary of State for Housing.
But MPs were divided on the matter and the ordinance has now expired, leaving many renters liable to face a substantial increase in housing costs. It is not yet clear whether new limits will be brought in to shield against last year's indexations being recuperated by even higher increases now or retroactive demands from landlords. There are fears that without such assurances, indexation arrears could add up to massive debts.
The failure to implement lasting regulations on rents in the capital will be a widely felt disappointment as the city's rental commission already noted a 20% rise in rent prices from 2004–2018. This was without including indexation. On the question of more structural rent controls in Brussels, regional authorities argue that the majority of stakeholders in the rental market have pushed against legal price caps. No surprise.
However, the argument against imposing limits on rents is primarily that it would discourage property owners from investing in their buildings, or could hit the region's construction sector. Yet this was precisely where the expired indexation freeze delivered, serving as a lever for the city's housing stock to be improved. The efficiency gains would greatly reduce greenhouse gas emissions and benefit the economy in carrying out the work.
In this context, can Belgium afford not to continue the indexation limits? Let @Orlando_tbt know.
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