For those of you who have the opportunity to extend your stay in Belgium, purchasing a home may seem like a good idea. Certainly, buying an apartment or a house is a long-term investment with many advantages. But before you get too excited and run off in search of your dream home, it’s wise to familiarise yourself with the real estate market in Belgium. Don’t panic, it's easier than you think!
Is buying a wise choice?
Rent or buy, that is the question. In Belgium, tenants are well protected by the law. This is why many expats choose to rent, especially if the duration of their stay in Belgium is limited. On the other hand, for expats planning to stay for a longer time, purchasing a home can provide more stability and could turn out to be a lucrative financial investment. Note that nothing prevents a foreigner from buying property in Belgium, although residents and non-residents are subject to different tax regimes. Attention, capital gains tax is levied at 16.5% on property sold within five years of acquisition.
Buy or build?
Is it better to buy a home or build it from scratch? If you choose to build your house, an architect can help you realise the house of your dreams down to the smallest detail. However, finding a plot of land is not always easy and obtaining the necessary administrative authorisations can be a real obstacle course. In addition, construction time can take longer than expected. If you opt for an already developed house or apartment, you won’t have to wait to find out what your home looks like, and it will probably cost you much less. On the downside, if the property is not the newest, you may have to pay a significant amount of money for maintenance, repairs or renovations.
How to find your dream home?
One thing is sure, your dream home is out there somewhere, it’s just waiting for you! To find it, you'll need a bit of luck and a good dose of perseverance. Keep in mind that there are three types of sales: an over-the-counter sale, a sale through a real estate agency and a public sale. All have advantages and disadvantages.
The over-the-counter sale
An over-the-counter sale is a sale without an intermediary where the owner concludes directly with the buyer. The advantage? It saves the cost of a real estate agency. However, make sure you know the estimated value of the property, as some owners may have a tendency to overestimate.
1) On the internet:
Your treasure is perhaps just a click away! Thanks to the internet, searching for real estate properties is easier than ever. Various real estate sites allow you to search for properties that suit your needs and your budget, in the region of your choice. Generally, these sites publish advertisements for over-the-counter sales but some also include ads from sales agencies or public auctions (see more below). Useful websites:
2) In the classifieds:
Check the classifieds in newspapers and journals. They regularly publish properties for sale.
3) On the spot:
Your heart is set on a city or a specific area? Walk around the corner and stay alert. Not all properties are sold on websites or through real estate agencies. A sign "à vendre / te koop" is sometimes attached to a property that’s for sale.
4) On social networks:
Social networks offer sometimes a wealth of information for real estate research. You can find many tempting offers through personal contacts or in specialised groups.
Real estate agencies
A real estate agent can also handle the transaction. Entrust your selection criteria to an agency and it will keep you informed of all the properties matching your wishes as soon as they are on the market. You will benefit from their expertise and avoid the overstatement of assets by some owners. Downside: you have to pay a commission fee, usually 3 to 5% of the purchase price and reduce your freedom to negotiate with the owner.
To find a list of real estate agents in your province, click here.
The public sale
At a public sale, a property is auctioned. This sale is always carried out by a notary, who develops specifications that cover all the conditions of the sale. Ads are then published in public places and in newspapers and have fixed viewing times. On the day of the sale, the notary has the choice to set a minimum price. The bidding process is often very interesting, as the highest bid wins the sale, provided it is accepted by the seller. Keep in mind that public sales move much faster than others, which does not allow you to think too long about your offer. Generally, you have five days to pay the acquisition fees and six weeks to pay the amount of the sale. These time periods can vary. It’s always a good idea to check the specifications drawn up by the notary! Moreover, it is impossible to include a suspension clause (see glossary) in these types of sales. This means that once you signed the sales agreement, you cannot go back!
You can find all public sales of Belgium on the websites mentioned above.
Steps to purchase a home (for an over-the-counter or agency sale)
Do you think you have found the perfect home; the one you absolutely have to have? Did it fill almost all of your criteria (have you had a peeked at the EPB certificate?)? You can then ask the seller for an option or directly make an offer. In this offer, you must accurately describe the conditions of your offer and its time limit. If it is accepted, you will be required to sign a pledge or a sales agreement. As a precaution, be sure to include the necessary suspensive clauses, for example that you can only pay if you get your home loan. In order to finalise the sale, you and the seller will employ a common notary or your personal notaries. After conducting a survey on the property offered for sale, the notaries will draft the deed and will proceed with its registration. You will need to pay notary fees and registration fees. Remember that other costs will be added on top of that, such as property tax, outstanding balance insurance, any condominium fees and home insurance.
- The Energy Performance of Buildings (EPB) certificate recently became compulsory. The certificate indicates the level of theoretical power consumption of the property on a scale from A (low energy consumption) to G (energy-intensive).
- The purchase offer: it is an irrevocable commitment from the potential buyer to purchase the property. However, it does not bind the seller.
- The sales agreement: it is a document signed between the seller and the buyer, which is significant of a definitive commitment of both parties. This typically goes hand-in-hand with the payment of a mutually agreed deposit.
- Supensive clause: this is a clause included in the agreement of a sale which, which if breached, makes the contract void.
- A home loan: a mortgage loan to finance the purchase of a private property.
- The deed: as its name suggests, it is a legal document drafted by a notary. His intervention makes the sale opposable to all. On the date of signature, it is read to the various parties that must sign it. The title is then transmitted to the recipient.
- Legal fees: it's the amount claimed by the notary at the time of signing the deed as compensation. There are online tools to calculate your notary fees.
- Registration fees: it is a tax levied by the state during the registration of the sale. In the Wallonia and Brussels region, you will pay 12.5% of the purchase price. In Flanders, this amount is 10%. For modest properties, it is possible to request a reduction in registration fees.
- Note: If the house is new (less than two years) you will, under certain conditions, pay VAT instead of the registration fee (up to to 21%).
- Property tax: this is an annual regional tax, the amount depends on many factors such as the property, its location, but also the composition of your family.
- Credit life insurance: this outstanding balance insurance is an insurance policy needed at the time of signing the mortgage that guarantees the repayment of credit in case of the buyer’s death.
- Common fees: if you buy an apartment in a building, you will have to pay certain common expenses together with the other owners.
- Home insurance: to protect your home, you should subscribe to a home insurance at your bank that will protect you against certain risks (theft, fire, etc.).
Each region offers a series of bonuses to support renovations. Find out more on the website of your region.
Don’t feel ready to buy a property yet? Then read our article about temporary housing solutions in Belgium.