The rental market is going from bad to worse: urgent action is needed to address the shortage

The rental market in Belgium is starting to resemble an American Black Friday: scarcity, long lines, and a fierce battle to secure a good deal. While real estate sales figures continue to rise, tenants are growing increasingly desperate in their search for a suitable home. Dietger Van Steertegem, Rental Operations Manager at Living Stone, observes these trends firsthand and feels the urgency to address this issue. But how do we tackle it? Spoiler alert: more taxes aren’t the solution. It’s time to take a fresh look at how we can truly revitalize the rental market before it turns into a chaotic jungle. Dietger, over to you! 

The Forgotten Rental Market 

“In recent months, the figures from the Notarisbarometer have once again caused quite a stir in the media. Personally, I look with pride at our own results, which we can compare to these national figures. With 12 real estate offices and more than 50 employees, we have once again managed to increase the number of sales transactions. In addition, sales prices themselves have also risen slightly.”

What often goes unreported, however, is the trend in the rental market. It is high time we started receiving quarterly figures for the rental market at the national level and put them into the proper context. Because while sales figures are rising, the situation for renters is anything but rosy. Rising demand and dwindling supply are creating a rental market that feels like an American Black Friday, with long lines, fierce competition, and a large number of disappointed applicants left behind. In my opinion, it is high time for the government to take action and devise measures that encourage landlords to invest in real estate, so that supply can be increased.”

Why demand is rising and supply is falling

“Why do we see this discrepancy between supply and demand? Belgium has a strong tradition of homeownership, with as many as 72% of the population living in their own homes. Since the 1970s, this percentage has remained fairly constant, partly thanks to tax policies that encourage homeownership. A home is often seen as an additional pillar of retirement income—and rightly so.

Nevertheless, 28% of our population remains dependent on rental housing, either due to circumstances such as a divorce or because they have not yet saved up the necessary down payment. These renters now find themselves in a difficult position. In today’s market, they practically need a letter of recommendation to find a new home. A cover letter with photos of the family, a letter of recommendation from a previous landlord, and even photos of their current interior are all used in an attempt to stand out. It seems like an absurd reality in today’s fast-paced rental market, but it is the new normal for the desperate applicant.” 

The government must take action 

“The government must act quickly to use the upcoming legislative session to increase the housing supply. Making renting more attractive to landlords is crucial to encouraging private investors. Taxes on rental income are certainly not the solution. What will help, however, is the introduction of tax measures that encourage landlords to invest in real estate.”

Concrete proposals for the rental market 

“There are many ways to stimulate the rental market in the long term. For example, eliminating the 21% VAT on investment properties, provided that these properties are offered for rent for more than 15 years. Or reducing the registration fees for the same type of property. These measures could have a significant impact on the supply and accessibility of rental housing.”

“But we could also provide better protection for landlords. The current legislation is designed to protect tenants, but in cases of tenant misconduct, landlords should have more options. These could include a higher security deposit, faster eviction procedures, or out-of-court settlements.”

“Formateurs De Wever and Diependaele, it is time to consider the tenants and provide additional legal protections and tax incentives for anyone who wants to rent out a property. Let’s work together on a solution that benefits both landlords and tenants.” - Dietger Van Steertegem