Belgium Loses 9,270 Construction Firms in Six Months

Nearly 9,300 Belgian construction companies ceased trading in the first half of 2026, according to sector figures released Monday, a net loss of 1,725 firms that the industry federation Embuild calls an “unprecedented decline” and is using to press the federal government for a powerful stimulus to residential construction.

According to VRT NWS, 9,270 construction companies stopped their activities between January and June, of which 1,538 were bankruptcies. In the same period, only 7,545 new construction firms were created, leaving the sector smaller by 1,725 companies in just six months. The number of closures was 14.6 percent higher than in the same period a year earlier.

The figures come from an Embuild analysis of data from the commercial information agency Trends Business Information, and land as the federal government works through a “very difficult and pressing” budget exercise.

A Sector Under Sustained Pressure

The crisis is concentrated in residential construction and renovation, a segment that has struggled for years and left many companies structurally vulnerable. In the first half of 2026, 3.8 percent fewer firms in this segment started up than a year earlier, while closures rose 13.6 percent.

The pain extends across other segments. Bouwkroniek, the Belgian construction trade journal, reported that starters in non-residential building and renovation fell 13.5 percent while closures there rose 21.7 percent. In infrastructure works, start-ups dropped 12.9 percent, even as closures edged down 1.9 percent year-on-year — still, the journal noted, at a very high level.

Order Books Are Draining

The closure figures reinforce warning signs that Embuild had already flagged weeks earlier. In a September 2026 economic survey of 200 construction and installation companies, the federation found that 67 percent had a below-normal order book, up from 58 percent earlier in the year, and 72 percent reported a decline in new customer contacts over the previous six months, up from 58 percent at the start of 2026.

“After the prices of construction materials already rose earlier, rising interest rates now make borrowing considerably more expensive,” Embuild CEO Niko Demeester said in the Embuild survey release. “To avoid a further housing crisis, a VAT cut on new-build is an absolute must.” The federation estimates that someone borrowing €250,000 today pays roughly €27,000 more than a year ago because of higher rates.

Momentum for a worsening outlook keeps building. According to the survey, 53 percent of residential builders expect a further deterioration in 2027, compared with the 40 percent who anticipated a worse 2026 at the start of this year.

A Looming Housing Gap

The closures run counter to enormous projected demand. Embuild estimates that Belgium needs 900,000 additional homes by 2050, driven by demographic shifts, more single-person and single-parent households, elderly people living independently longer, and structural demand for second homes.

The federation says Belgium must build 75,000 extra purchase, rental and social homes every year to 2030, and roughly triple its renovation rate — goals that a shrinking contractor base will struggle to meet.

As the closures mount, Demeester warned that the sector’s contraction leaves Belgium less able to deliver on its own building ambitions. “Because of this sharp decline, we can less and less meet the major housing, renovation and infrastructure objectives facing our country,” he said in comments carried by the trade journal Bouwkroniek. He called the decline in construction and installation SMEs “particularly alarming,” warning that “our country faces the largest construction task since the Second World War.”

Embuild’s Policy Demands

Embuild is using the data to press two central demands on the federal government. The first is a permanently reduced VAT rate for the construction and purchase of one’s only and own home, and for homes rented out for at least fifteen years, subject to an area limitation. The federation notes that more than half the cost price of a new-build home already flows back to the government through taxes and social charges.

“In the context of the federal budget consultations, we urgently call for a powerful stimulus to boost residential construction,” Demeester said, adding that infrastructure investment for defence and justice must also be strengthened.

The second demand is a larger public investment programme. Embuild wants public infrastructure investment raised to 4 percent of GDP from the current 3.1 percent, well above the European Union average of 3.7 percent, with a focus on barracks, prisons and court buildings.

VAT on construction has been a recurring flashpoint. In the November 2025 federal budget agreement, the government kept rates unchanged — 6 percent for renovation and demolition-rebuild, 12 percent for social housing and 21 percent for new-build — a partial win for Embuild, which also welcomed an €800 million cut in labour costs while voicing concern over higher employer costs and new worksite attendance registration.

What to Watch Next

The immediate test is the federal budget. Embuild has framed its VAT demand as a way to avert a housing crisis rather than a sector bailout, but any change would carry a direct cost to public finances at a moment when the government is searching for savings. Building permits for residential construction are already at a historic low, deepening the gap between the homes Belgium says it needs and the contractors left to build them.

As the German-language public broadcaster BRF reported, the federation’s central message is blunt: without a “powerful impulse” for housing, the country risks falling further behind its own construction goals. Whether the budget delivers that impulse — or simply holds the line on taxes — will shape the sector’s trajectory into 2027.