The number of real estate transactions in the first half of 2021 reached the highest number since the launch of the Belgian Notary Federation’s (Fednot) real estate barometer in 2007.
Fednot’s latest barometer published on Thursday showed the number of real estate transactions increased by 30.6% compared to the first six months of 2020, and by 16.7% compared to the previous year, during which the transactions were not impacted by the coronavirus crisis.
“Our real estate market is in an exceptional phase. Perhaps there is even a FOMO effect (fear of missing out), which makes buyers extra eager for real estate,” Notary Bart van Opstal, spokesperson for Notaris.be, said.
The highest increase in real estate activity was reported in Wallonia, where the number of transactions increased by almost 20% in comparison with the first half of 2019. In Flanders and Brussels, there was an increase of 16.1% and 8.8% respectively.
Meanwhile, property prices once again increased in the first six months of this year, but not as sharply as during the second half of 2020, whilst the price increase for sold houses, land and flats was the highest in Flanders in comparison with Wallonia and Brussels.
A residential property in Belgium was on average 4.5% more expensive in the first six months of 2021 compared to the annual average for 2020, which when taking into account an inflation rate of 1.3%, represents a real price increase of 3,2% and an average additional cost of €9,000.
According to van Opstal, the rise in house and flat prices is the result of particularly high demand for real estate.
Flats are slowly gaining market share, but houses, of which the average price in Belgium now stands at around €290,000, still accounted for 72.6% of transactions in the first six months of 2021.
Why is there such a demand?
Aside from the FOMO effect, the fact that interest rates remain quite low has played a role in activity increasing, according to Renaud Grégoire, spokesperson for the Belgian Notary Federation, who added that, across the economy, there is strong demand for all types of assets, including real estate.
“Many individuals or investors are refocusing on real estate and are ready to invest money that has been tied up elsewhere for some time in order to buy a property,” he added.
The high level of activity results in average prices continuing to rise, and according to van Opstal, buyers are advised not to buy too quickly or make rash decisions, as he hopes the market will cool down during the summer months.