Brussels Government fails to limit rent indexation

Brussels Government fails to limit rent indexation
Photo from office of Nawal Ben Hamou.

A proposal to limit rent indexations in Brussels by using a consumer price index – which would exclude the increasing cost of energy products – was blocked by the Capital Region's government on Thursday.

Brussels State Secretary for Housing Nawal Ben Hamou put forward the proposal for the new calculation method based on the consumer index without energy products. This would see costs such as those for electricity, natural gas, butane, propane, liquid fuels, solid fuels and motor fuels left out of the calculation.

Ben Hamou proposed a retroactive introduction of this calculation method effective from 1 January 2022, meaning tenants would only be impacted by the rise in gas and fuel prices once, instead of every few weeks.

"I put a balanced proposal on the table. The consumer price index excluding energy products is more logical and more stable," she said, adding that she regretted the fact that some MPs still "refuse to face reality, for purely ideological reasons."

Empty tenancies and unpaid rent

While the proposal had the support of the socialist and green parties within the regional Government, it was blocked by the liberal Open Vld and the Brussels liberal Défi parties. "Their obstruction does not protect landlords, quite the contrary: it exposes them to an upsurge in empty tenancies and unpaid rent," Ben Hamou stressed.

Under the current system, tenants' rent can be adjusted to the cost of living every year. At the end of June, the indexation was set at 8.3%. In practice, this means that for someone who paid €1,000 rent when their contract was signed in May 2021, the landlord is entitled to index that amount to €1,083 from June 2022 forward.

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Still, Brussels Budget Minister Sven Gatz told La Libre that "as a liberal," he was "very reluctant" about state intervention in a private contract between citizens. "A de-indexation could have a positive impact on tenants in the short term. But the medium-term effect for landlords, and thus for the rental market and tenants, would be negative," he added.

Brussels Employment Minister Bernard Clerfayt stated that there is "no reason" to take general measures. "It is a populist measure that does good in the short term, harm in the long term," he said. "All measures to block or reduce indexation discourage construction and renovation."

"I am not asking for the abolition of rent indexation, but for it to be more balanced," Ben Hamou explained to La Libre. "I hope that Bernard Clerfayt will come to his senses."

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