House prices increased four times faster than inflation in 2019
Thursday, 09 January 2020
It is the first time in ten years that the difference between the price increase and the inflation was this big. Credit: Belga
House prices in Flanders have risen by 3.52% in 2019, which is four times more than the inflation (0.76M%), according to the annual barometer of the ERA estate agents and the KU Leuven.
It is the first time in ten years that the difference between the price increase and inflation was this big.
Over the past 15 years, the KU Leuven conducted a survey on the real estate market, based on about 60,000 transactions, together with ERA.
The ERA-KULeuven-Real Estate Index (EKVI) shows the price evolution of similar homes based on factors such as size, finishing and location. The Index showed that Flemish house prices rose by 3.52% in 2019. Inflation, which is the increase in prices of consumer goods, was 0.76%, which is four times less.
“It has been ten years since the difference between inflation and the rise in house prices was so big,” said Johan Krijgsman, CEO of ERA, reports Het Nieuwsblad. “In 2009, it was 0.26% and 1.42%, respectively. In other words: in 2019, our homes will not only have risen in absolute price, but even more so in relative value. It means that property owners have had a very good year,” he added.
However, the researchers do not expect prices to continue to rise at the same high rate in the coming years. The abolition of the housing bonus will have a ‘price dampening’ effect, because the loss of the bonus will allow Flemish citizens to borrow 9 to 13% less, reports De Standaard.