Real estate has always been considered a good investment in Belgium. Between 1980 and 2010, real estate prices increased on average by 10%. This period is commonly referred to as the “Glorious Thirty.” In fact, compared to movable investments, we can confidently say that real estate was a profitable investment for a prudent family man, even though investing in real estate is not always smooth sailing. Consider the issues with unreliable tenants and property aging, not to mention the significant evolution of energy preservation standards. In 2014, is real estate investment still justified? What are the medium and long-term prospects? As the next Batibouw fair approaches, our consultants answer these questions.
The real estate market is undergoing a crisis
Growth in the real estate market still exists, but it is no longer comparable to what we experienced during the “Glorious Thirty.”
Houses
Throughout 2013, the annual price of houses was 233,959 €, an increase of 3.2% compared to 2012. Unsurprisingly, house prices are higher in Brussels (410,194 € on average), followed by Flanders (250,281 €) and Wallonia (176,176 €).
Apartments
In 2013, the average price of apartments in Belgium was 204,181 €, with significant regional differences: 155,610 € in Wallonia (+1.7%), 204,402 € in Flanders (+2.1%), and 228,408 € in Brussels (+4.2%).
Conclusion
Real estate remains a growing market, but this growth is no longer comparable to what we knew in the past. Brussels remains the best place to invest. The quality of the chosen location remains fundamental. Remember, the profitability of a real estate investment depends on several criteria (long-term evolution of the chosen location, quality of materials used, quality of your tenants).
Investing in real estate?
It remains an interesting choice if you combine the long-term capital gain with the rental income. However, be sure to buy a good quality property, compliant with environmental standards, located in a promising area, and ensure the quality of your tenants.
Long-term perspectives
Without being able to predict the future, we can certainly say that the world population will only continue to grow, and space will become scarcer. Urban concentration phenomena, both socially and professionally, will only intensify.
Prices should therefore continue to rise, but not in the same proportions as during the past thirty years. A growth of 2 to 4% per year seems more reasonable.
30 years of presence in the real estate market
Our company has extensive experience in the mortgage loan market. We are at your disposal to provide answers to your questions.
