The Belgian real estate market has recorded a significant drop in residential property sales for the first half of 2023, according to the Notary Barometer. However, this trend is not uniform across the country.
The overall decline in transactions
In the first half of 2023, real estate transactions fell by 4.2% compared to the same period in 2022, despite a resurgence in activity in June (+5.5%). The months of January, February, and May were particularly damaging, with respective declines of -10.5%, -10.4%, and -6%.
Regional disparities
Flanders was the most affected with a decline of 5.9%, followed by Brussels (-3.7%) and Wallonia (-1.1%). Interestingly, the least expensive province in the country, Hainaut, showed a notable increase (+3.1%).
A slight dip in house prices
The average price of houses slightly dipped (-0.3%) to stand at €320,937, with a more pronounced drop in Wallonia (-1.4%) and especially in Brussels (-4.1%). However, Flanders recorded an increase of 1.7%, setting the average price at €356,863.
Rise in apartment prices
Paradoxically, the average price of apartments increased in Belgium (+1.7%), peaking at €255,882. This increase was more pronounced in Flanders (+2.5%) and Wallonia (+2.4%), but absent in Brussels (-0.6%).
Focus on new apartments
The price of new apartments saw a significant surge (+5.6%), averaging €314,479. However, their market share is at its lowest since 2018, accounting for only 15.1% of transactions.
Additional insights
It’s worth noting that these are average prices, not median prices, which are less representative. Moreover, the market is divided between standalone properties and energy-inefficient homes. The latter are dragging down the market, while the former continue to enjoy robust success.
What does this mean for buyers and sellers?
For Buyers
The current market conditions present a mixed bag for potential buyers. While the average price of houses has seen a slight dip, the cost of apartments and especially new apartments has risen. This could mean that buyers looking for more affordable options might have to consider older properties or even shift their focus from apartments to houses.
For Sellers
Sellers of standalone properties and new apartments are in a favorable position given the current market trends. However, those with energy-inefficient homes may find it challenging to attract buyers without significant price reductions or renovations to improve energy efficiency.
Investment opportunities
Regional Focus
For investors, the regional disparities offer a unique opportunity. Areas like Hainaut, which have shown a positive trend, could be potential hotspots for investment. On the other hand, the declining markets in Flanders and Brussels might offer opportunities for bargain purchases, especially in the residential house segment.
Property Type
The rise in apartment prices, particularly new apartments, indicates a strong demand for such properties, making them a potentially lucrative investment. However, the declining market share of new apartments suggests that investors should proceed with caution and conduct thorough market research.
Conclusion
The Belgian real estate market in the first half of 2023 has been a rollercoaster, with significant declines in residential property sales but not uniformly so across all regions and property types. While the market for houses has seen a slight dip in prices, apartments have become more expensive, especially the new ones. These trends offer both challenges and opportunities for buyers, sellers, and investors alike. As the year progresses, it will be interesting to see how these trends evolve and what new patterns emerge.
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