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Bricks and mortar: Our tips on buying a home in Belgium
Belgium has long enjoyed a love affair with home ownership. In the current economic climate, there has been some pessimism due to the difficulty in finding loans and complex procedures for securing subsidies, but nevertheless, Belgians remain addicted to buying property.
They are not alone. With prices far lower than major cities in neighbouring countries, it’s no wonder that expats share Belgium’s enthusiasm. In a recent survey of our readers, 45% replied that they lived in their own home. If you’re tempted to join them, read our tips on getting ahead of the property game.
Registration tax in Belgium is high – 12.5% of the purchase price (10% in Flanders) – and there’s a 16.5% capital gains tax on properties sold within five years to bear in mind. Given those costs, you’ll need to own your home for a number of years before you consider selling it. If you buy new from a property developer you’ll pay 21% VAT but no registration tax. So do your homework before buying, taking into account proximity to schools, facilities and public transport. And it’s worth deciding now if you can cope with a renovation project or prefer a property that requires minimal work before you can move in.
Once you have your finances in place and have found a property that ticks all or most of your boxes, you can make an offer. It’s customary to make an offer lower than the asking price. Avoid showing too much enthusiasm in front of the seller and be ready to negotiate. This offer is a legal commitment to buy and has a set of standard conditions, which may include a clause about the mortgage. They also cover the deposit, which will be lost if you back out. The deposit should be paid into an account held by the seller’s notary. Both buyer and seller need a notary (the notaries split the fee) so it helps to make contact with one before you make an offer. It’s customary for the legal documents to be in the language of the buyer. The second stage is a notarised deed that is usually drawn up within four month after the sales agreement. The notary checks the legal status of the property and the previous 30 years of ownership, as well as any environmental or building restrictions.
Before even thinking of making an offer, you need to get the finances sorted. With record low interest rates, it’s worth shopping around for a mortgage loan. Get your calculator out to work out if a fixed (the more popular) or variable repayment rate suits you best, as well as deciding on the repayment period (up to 25 years). Don’t forget to check the conditions of each loan offer, such as obligatory life insurance. Worried about losing your job after taking a mortgage? In Flanders and Wallonia, there is free insurance – with certain conditions – against loss of income. Don’t underestimate the costs of removals, refurbishment and running costs. And last but not least, you’ll be expected to have the money ready to pay for the deposit (usually 10% of sale price), registration tax and notary fees. Don’t forget to check out the annual property tax.
It’s not usual in Belgium for the condition of the property to be checked by a structural surveyor, so the emphasis is on the buyer to check for potential problems. If you’re going to renovate, it’s worth getting an estimate from a builder. You may well prefer to get an expert or another opinion for an unbiased view before making an offer.
Real estate agencies can assist your property search and also guide you through the bureaucratic maze, especially if you need translation services. Consider hiring an agent who acts on your behalf rather the seller’s (which is the norm in Belgium). This can cost anything from €250 to €1,000.
This article first appeared in The Bulletin Newcomer autumn 2016. See the Moving section at the back of the magazine for more practical advice on buying property.