Since 2022, the rise in interest rates had gradually slowed down the evolution of real estate prices. This trend was particularly accentuated at the start of 2023, when the annual price increase fell below 2.5%, reaching a low of 1.2% in January 2024. However, since the start of 2024, prices showed signs of recovery, supported by falling interest rates which have fallen by -0.6 percentage points since the start of the year.
After an increase of +0.9% in the second quarter, the trend continued in the third quarter with a similar increase, bringing the national average price to €2,325 per m². For comparison, the same period in 2023 saw only a more modest increase of +0.4%, while in 2022 the increase stood at +0.6%.
Over the whole of 2024, price growth now reaches +2%, thus surpassing that of the same period in 2023 (+1.4%), even if we still remain far from the annual increases observed between 2018 and 2022.
In terms of average prices per square meter, it is no surprise that prices are highest in Brussels, with an average of €3,348/m². In Wallonia, prices are almost half as expensive (1,733 €/m²), while in Flanders it costs 2,471 €/m².
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In large cities, price developments show a very contrasting picture. Namur recorded the largest increase with + 3.1% this quarter, while Flemish cities such as Ghent and Bruges follow with + 2.1%. On the other hand, the city of Charleroi saw a notable drop of -0.9%, the only one among the 12 main cities to observe a decrease in prices this quarter. Leuven and Antwerp showed more moderate increases of +0.3%.
Since the start of the year, the ECB’s two successive cuts have had a positive impact on mortgage interest rates in Belgium, with a cumulative drop of -0.6 percentage points compared to December 2023. This reduction allowed Belgian households to recover on average 6 m² of real estate purchasing power in 2024, after having lost 18 m² between the start of 2022 and the end of 2023. Thus, the average household (made up of two married adults or legal cohabitants) has regained a third of this lost purchasing power. While the average surface area that households could acquire in December 2023 had fallen to 103 m², it has now risen to 109 m².
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Meanwhile, mortgage loan volumes recovered slightly in July, reaching their highest level since February 2023, according to ECB data on mortgage loans to households for the purchase of homes. However, the ECB has provided little information on the future direction of its monetary policy, leaving the path of rates to depend on upcoming economic data. For its part, the American Federal Reserve (Fed) marked a turning point with its first reduction in key rates since March 2020, lowering them by 50 basis points. The signals therefore seem favorable to further rate cuts which could further increase the purchasing power of households and promote access to property.
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