House prices stabilise, inflation cancels out modest price rises

The cooling of the property market started in 2022. "We saw year-on-year drops of about 15 per cent in 2023 compared to the previous year," says notary Bart van Opstal.

"In the first three months of this year real estate purchases across the country were down more than 7 per cent, compared to the same period last year. In Flanders, we are even talking about a drop of more than 8 per cent. In Wallonia, we are looking at a 6.5 per cent drop. Only in Brussels did sales remain virtually stable."

According to Van Opstal, the fact that the number of property sales has fallen during the last two years is not that surprising. "We obviously saw that buying spree during the pandemic, when interest rates were so low. That triggered extra volumes in the real estate world."

"That was an exceptional period. We knew that the effect of that would wear off and we would get back to the more normal levels of before the pandemic."

Sales drop below 2019 levels

If you look at the figures, you see that sales are now below 2019 levels, the pre-pandemic period. And that is striking, says Van Opstal. "We note that buyers in particular are less active. There is no real estate shortage in Belgium."

According to Van Opstal, one of the reasons for this is the behaviour of young buyers. "Young people used to have a market share that hovered around 30 per cent. We see that this group is now less active, representing a market share of 27 per cent."

"There’s a double explanation for that. On the one hand, a lot of young people bought property at an earlier age than usual when interest rates were very low. These young people are not buying a 2nd time now and so we don't see them in the figures."

"On the other hand, there are a lot of young people who are now waiting to see what happens. They are waiting in case interest rates come down and property prices fall. That would obviously make it easier and more interesting for them."

Another group that has had an impact on falling property purchases are investors. "There were a number of interesting alternatives for investors of late such as the state bonds. They are now not only looking at real estate, but also at other investment formats."

Property prices stabilising

The real estate barometer also shows that property prices are stabilising. A house in Belgium cost an average of 328,187 euros in the first quarter of 2024. In absolute terms, that is a price increase of 1.7 per cent compared to the same period last year. But if you take inflation into account, it amounts to a price drop of 0.6 per cent.

"In Flanders, the average price of a residential property rose by 2.4 per cent to 367,120 euros," Van Opstal elaborates. "Taking into account the difference in terms of inflation, the price remained pretty much stable with an increase of 0.1 per cent."

The average price of a house was on the rise in all Flemish provinces, if we do not take inflation into account. In Flemish Brabant, the price rose by 3.1 per cent, to an average price of 433,320 euros. There was an identical price rise of 3.1 per cent in Limburg to 317,594 euros.

In West Flanders, prices rose slightly more, by 3.8 per cent, to an average house price of 334,378 euros. In Antwerp and East Flanders, prices rose less: these were up 1.3 per cent and 1.9 per cent respectively. Taking inflation into account, the real price there fell slightly: down 1 per cent and 0.4 per cent respectively.

In Wallonia and Brussels, prices fell, even without taking inflation into account, by 0.3 per cent and 3.1 per cent respectively.