Belgium’s Rental Market Sees Sharp Decline in Rental Contracts and Supply
-
Loading... - Miles Fuller
- 14 Oct 2024
- 54 Views
- 0 Like
- 0 Comment
The rental market across Belgium is under significant pressure, with dwindling rental contracts, limited supply, and growing competition for available properties. Economic challenges, stricter energy regulations, and shifting investor interests are driving these trends, impacting the regions of Brussels, Flanders, and Wallonia differently.
In Brussels, the number of new rental contracts has plummeted by 20% in early 2024, even as demand remains high. Contributing factors include rising interest rates, construction delays, labor shortages, and stringent energy efficiency standards (PEB). With most of Brussels’ rental market made up of apartments, rents increased by 2.8% in the first half of 2024, and they may surge by 6% by the end of the year. Federia, the Federation of French-speaking Real Estate Agents of Belgium, emphasizes that the issue lies in the lack of available properties rather than rent prices. Without policy shifts encouraging private investment, the housing shortage is expected to worsen.
Flanders faces an unprecedented 30% decline in rental contracts in the first half of 2024, creating fierce competition among tenants. Listings are overwhelmed with 40-50 interested parties per property, with some receiving up to 90 inquiries. Mid-range rentals (€700-850) are particularly scarce, but rent increases have remained in line with inflation. Market experts say the shortage is exacerbated by high interest rates, which discourage tenants from moving, and by investors exiting the market due to renovation costs and difficulties securing building permits.
While Wallonia’s rent increases have been more moderate—2.52% in the first half of 2024 following a 4.3% rise in 2023—the region faces similar challenges. Demand continues to outpace supply, with many investors withdrawing from the market, leading to decreased housing accessibility. Real estate agents report that accessibility has fallen by 50% over the past two years, deepening the crisis.
Belgium’s rental market is facing a perfect storm of limited supply, stagnant investments, and heightened demand. While Brussels and Flanders are seeing significant rent increases, Wallonia's slower growth offers little relief as supply continues to dwindle across the board. Real estate professionals warn that unless policies are introduced to incentivize private investment and support new housing projects, the rental market crisis will only deepen, pushing more renters into precarious situations.
