Costs when buying a property in Wallonia?

Houses are expensive in Flanders. Very expensive. Wouldn’t it be worth it for a young couple to peek across the language border? Maybe. We’ll weigh the advantages and disadvantages below.

Indeed, houses in the Walloon Region are the cheapest in the country. On average, you pay around 2,200 euros per square meter for an apartment and a little over 1,500 euros per square meter for a house (compared to 2,800 and 2,100 euros respectively in Flanders). But before you start dreaming of a villa on the edge of the Ardennes, consider a couple of things.

Firstly, not all provinces and municipalities are equally inexpensive, just like Antwerp is more expensive than Limburg and Ghent is more expensive than Roeselare.Secondly, even though the average purchase price is significantly lower, be cautious of the higher costs!

It’s all about the registration fees. Remember the “large and small description” system that used to exist in Flanders? It was a rather peculiar system where you had to pay higher taxes for valuable houses based on the cadastral rental value from ages ago. That system was replaced in Flanders in 2018 with a fixed percentage that has also decreased a few times in recent years: today, you typically pay a standard 3% registration fee for a first family home.

But here’s the thing: the old system still exists in Wallonia. In the Walloon Region, you either pay 12.5% registration tax for a cadastral income above 745 euros (large description), or 6% for a “modest habitation” with a lower cadastral income (small description). However, please note that you usually don’t pay registration fees on the first 20,000 euros. This is called the “abatement.”

But it gets even more complicated because even with a small description, you still pay 12.5% for the amount above 166,766 euros. In municipalities with real estate pressure, that threshold is 177,884 euros. To make it even more confusing, the 6% becomes 5% if you can benefit from a social loan. And one more thing: if you have more than two children, the threshold for the large description is higher than 745 euros. Even a notary would get a headache from this. If you want to read it again, have fun on the website of the Federal Public Service Finance.

But what does it all come down to? Let’s say you buy a house for 250,000 euros, and the cadastral income is below 745 euros. So, it falls under the small description. You don’t pay anything on the first 20,000 euros. You pay 6% on the next 166,766 euros. And you pay 12.5% on the remaining 63,234 euros. Total: 17,909 euros in registration fees. In Flanders, that would only be 7,500 euros (3% of the total amount) and even only 2,500 euros if you promise to renovate energy-efficiently (1% of the total amount).

That’s a significant difference, and it will only become bigger if you still want to go for that expensive villa in the Ardennes…

Are you considering a purchase just across the language border and looking for someone who can explain the difference with Flanders? Then make an appointment in that area because that’s where our mortgage experts with the most experience are located.