Property purchasing power in Belgium remains low

Rising prices on homes have slowed, but Belgian residents' property purchasing power is still down according to the latest price index published by Immoweb.

According to the figures, the average Belgian household could afford to buy a property in the region of 105m² in the last quarter of 2023, a fall of 6% in one year.

Home price rises are also slowing at national level, at around 3%, the lowest price rise in five years.

The upward trend in prices since 2017 had been steadily gaining in intensity, rising from 2.3% to a peak increase of 6.1% in 2020 as an annual average for Belgium as a whole. That year was marked by the pandemic and a related boom in transactions in more rural areas.

But, by 2022, there were already signs of a slowdown, with prices rising by an average of 4%.

Flanders saw a price growth of 3.8% in 2023. In Wallonia, the figure is 2.3%. Brussels is the region most affected by this slowdown, with a rise of 0.7% in 2023, compared with 3.1% in 2022.

“This trend is not unrelated to the rise in interest rates, which has exerted palpable pressure on Belgians' property purchasing power,” said Piet Derriks, managing director of Immoweb.

In January 2022, the average property transaction was for a home measuring 127m² - while the most recent figure is 105m².

"To reach the level of early 2022, the highest point in recent years, interest rates would have to fall to 2%, a possibility that seems unlikely in 2024," said Derriks.