The New Flemish Government Lowers Registration Duties

The Flemish government is considering reducing the registration duties for the purchase of a first and sole residence from 3% to 2%. This potential change could take effect on January 1, 2025, offering significant savings for many prospective buyers.

Lower Registration Duties: What Does This Mean for Your First Home?

The Flemish government is considering reducing the registration duties for the purchase of a first and sole residence from 3% to 2%. This potential change could take effect on January 1, 2025, offering significant savings for many prospective buyers.

What Does This Reduction Mean in Practice?

Registration duties are the tax you pay when registering the deed of a property. The proposal is to reduce this rate to 2% for the purchase of a sole and primary residence, provided that you live in the property yourself. If you already own a property or are planning to invest in real estate, this reduction will not apply to you.

For example, the median house price in Flanders in 2023 was around €328,800. Under the new 2% rate, you would pay €6,576 in registration duties, saving nearly €3,300 compared to the current 3% rate.

Changes for Investors

While registration duties for first-time homebuyers may decrease, the rates for professional property investors will increase. For individuals who buy, renovate, and resell houses, the rate will rise from 4% to 6%. This aligns with the government’s broader goal of making homeownership more accessible for private individuals while imposing higher taxes on profit-driven investments.

Will Houses Become Cheaper or More Expensive?

Although a reduction in registration duties seems beneficial for buyers in the short term, the long-term impact on property prices remains to be seen. Research by the National Bank shows that a previous reduction in registration duties, from 6% to 3%, led to an average 3% increase in housing prices. It's possible that this new reduction could also increase demand, potentially driving prices up.

What Should You Do as a Buyer?

Are you planning to buy a home soon? It's a good idea to closely monitor these developments. It’s important to know when the reduction will officially take effect and what the reference point will be: the compromise of sale or the deed of purchase?
For any questions or advice on how this change could affect your purchase, feel free to reach out to us.
Contact us:
info@maxime-realestate.be

02 771 16 35

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