Belgian Home Sales Fall as Mortgage Rates Bite

Fewer homes changed hands in Belgium in the third quarter of 2026 as sharply higher mortgage rates squeezed buyers, according to the quarterly real estate barometer published by Fednot, the Federation of the Notariat. Nationally, sales fell 2.2% compared with the same period a year earlier, the first year-on-year decline of the year. Yet prices kept climbing, leaving buyers to absorb both a costlier loan and a pricier property.

The slowdown is not uniform. House sales dropped 2.8% nationally while apartment sales slipped only 0.4%, reflecting continued demand for smaller, more affordable homes. Regional differences are stark: sales in Wallonia fell 5.1%, more than four times the 1.1% decline in Flanders, while Brussels was essentially flat at -0.1%, VRT NWS reported.

The Mortgage Squeeze

At the root of the cooling market is the cost of borrowing. The long-term fixed rate on a home loan now stands at 4.29%, up from 3.46% a year earlier — an increase of 0.83 percentage points. In August 2026, the mortgage rate reached its highest level in 12 years and has continued to rise since.

“Interest rates have risen, which has made mortgage loans more expensive too,” said notary Bart Van Opstal, spokesperson for Notaris.be. “If you finance an average house price with an average loan and the interest rate rises 1 percent, you can easily pay hundreds of euros more per month.”

The impact on monthly budgets is substantial. John Romain, CEO of mortgage brokerage Immotheker Finotheker, calculated the difference for a €396,000 home financed with a 90% loan of €356,000 over 25 years. At today’s 4.29% rate, the buyer pays €1,921 per month and €220,308.89 in total interest over the term. A year earlier, at 3.46%, the same buyer paid €1,764.38 a month and €173,315.25 in interest. That is an 8.9% increase in the monthly repayment and roughly €47,000 more interest paid over 25 years.

“So you now pay 8.9 percent more per month than a year ago,” Romain said.

Higher rates are also driving investors away from property toward alternatives such as bonds that now offer more attractive returns, Van Opstal noted, further thinning demand.

Prices Keep Rising Despite Slower Sales

The fall in sales volumes has not translated into lower prices. In Flanders, an average house cost €398,182 in the third quarter, up 3.5% from €384,781 a year earlier. Over five years, Flemish house prices have risen 21.5%, from €327,785 in 2021. Nationally, a house averaged €360,613 across the first nine months of 2026, with apartment prices up 2.0% to €287,616, according to the Fednot Q3 2026 barometer.

“We are in a long period of price increases,” Van Opstal said.

Within Flanders, only Vlaams-Brabant recorded a rise in sales (+1%). Declines ranged from -0.6% in Oost-Vlaanderen to -2.4% in Limburg. The single steepest drop was in Limburg houses, down 5.1%, while Oost-Vlaanderen recorded the largest apartment decline at -3.6%.

Young Buyers Stay, Older Buyers Step Back

Despite the cost, younger buyers remain the most active group on the market. People aged 26 to 30 were the most active category nationally across the first nine months of 2026, buying 15% of apartments and 22% of houses in Flanders. More than half of buyers taking out a home loan through Immotheker Finotheker are younger than 35.

“I suspect they assume the interest rate will only rise further. If that assumption is correct, you should indeed bite the bullet now and waiting won’t help,” Romain said. “That doesn’t mean they have it easy today.”

Older buyers are retreating instead. In 2021, 41.6% of home-loan borrowers were over 40; that figure has now fallen to 30.7%. Most banks will only extend a loan until the borrower turns 70, discouraging those who cannot be debt-free by retirement. “You are best off being debt-free the moment you retire,” Romain said.

The barometer shows a market that has cooled steadily through 2026. In the first quarter, sales were up 3.4% year-on-year; by the second quarter, growth had slowed to 1.5% and turned negative against the prior quarter, with Fednot already flagging rising rates. The Q2 barometer recorded a 1.6% quarterly decline nationally, which has now become a full year-on-year contraction.

A Tax Change and an Uncertain Outlook

At the end of September, the Flemish government announced it would raise the registration tax on a first own home back from 2% to 3%, effective from 2027 — a reversal of a years-long trend that had cut the rate from 10% to 2% over roughly eight years. Buyers are expected to rush to sign contracts before 1 January 2027 to lock in the lower rate, followed by a likely dip early next year.

Van Opstal expects that effect to be limited. “First, the increase will have a short stimulating effect, because everyone who signs a sale agreement before 1 January 2027 can still buy at 2 percent registration duty,” he said. “Early next year there may be a dampening effect, but in the past we have seen that the impact of percentage changes is relatively small. The influence of the mortgage rate is much greater.”

Not everyone welcomes the tax rise. Geert Goeyvaerts, a researcher in housing taxation at KU Leuven, called it “a regrettable intervention” with “a high welfare cost.”

Looking ahead, Romain expects mortgage rates to climb a further 0.25 to 0.50 percentage points, driven by the conflict in the Middle East and its effect on oil prices, an ongoing energy crisis, and rising grocery costs. He estimates inflation could peak near 5.25% in January. “Banks that lend money will also want more collateral and will likely push the rate higher,” he predicted.

For buyers, the message is sobering: waiting may not bring relief, and both the cost of borrowing and the price of the home itself appear set to rise further before they ease.