The price of renting a property in Flanders has increased significantly. Figures published in the real estate federation CIB’s annual “Rent Barometer” show a year-on-year increase of 4.7% in the average price paid to rent a property in our region. A shortage of properties to rent and demand for energy efficient properties are serving to fuel the increase in rents.
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Average rent in Flanders now at 815 euro/month
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The average price of renting a terraced house in Flanders currently stands at 885 euro/month. Meanwhile, the average rent payable for a flat is 773 euro/month. To arrive at these figures CIB looked at 25,000 new rental control concluded through real estate agents. Contracts concluded directly between tenants and landlords are not included in the figures.
The 4.7% increase is much higher than in recent years. The high rate of inflation has of course played a role. The cost of living in general has and this is reflected by higher rents.
However, there are also other factors that are fuelling the increase. Property prices have increased, and interest rates are up.
CIB’s Kristophe Thijs told VRT News the “Mortgage rates are increasing. It is becoming more difficult for some people to be able to buy a property. This group remains on the rental market for longer thus making the shortage on the rental market even greater. Estate agents tell us that energy efficient properties sometimes have as many as 50 candidate tenants”.
The energy crisis is also having an impact on the rental market. Would-be tenants are prepared to more for an energy efficient property as they believe that the extra they will pay in rent will be more than compensated for by the savings the make on their energy bills.
An atypical year
Mr Thijs went onto say that it has been an atypical year for the property market. "For the first time in years the increase in the price of new lets has increased less sharply than the rents payable by those with existing contracts”.
This is above all due to the fact that a landlord can increase the rent payable by an existing tenant by a percentage equivalent to the so-called “heath index”.
The health index is inflation not including tobacco, alcohol, petrol and diesel. At the end of last year, the health index stood at 9%. "Landlords like to be certain that their tenants will be able to pay their rent. Consequently, they have become a little more lenient when setting their rents for new lets”, Mr Thijs said.
With inflation predicted to be 4.5%, this year tenants that sign a new rental contract can expect a sizable rent increase in twelve months’ time.