affordable building — why buying today is still better than buying tomorrow
It doesn't look like it's going to get any easier to buy your own home in the near future. Buying yesterday would have been even better with the historic low interest rates, but today is the second-best option.
why have houses gotten more expensive?
It's a combination of a number of factors, but the corona crisis obviously played a big role. Before the pandemic, prices were already rising, but they gained further momentum.
Being required to spend more time at home, many more people wanted a house with a garden. At the same time, central banks kept interest rates low to limit the impact of the corona crisis on families. This allowed the average family to borrow more and thus offer a higher price for those coveted homes.
There were also shortages of building materials, which sent prices soaring and forced construction companies to pass that on to the end customer.
what's in store for us?
No one has a crystal ball, including us —unfortunately—, but the expectations are that house prices will stabilize. Real estate experts think that prices will rise more slowly, but there is no immediate prospect of a fall.
So is it still a good idea to buy today? We think so. Here's why:
- Because no decline in real estate prices is expected, you are still better off buying as early as possible" That way you benefit from a lower purchase price and your investment has more time to grow.
- Interest rates are starting to rise, but are still relatively low. If you start negotiating with your bank today, you can get ahead of a further rise. The larger the amount you need to borrow, the stronger this argument plays.
- The alternatives are not very attractive. Rental prices have also risen steeply in recent years, to an average of 1100 euros per month for a house, so an average family doesn't save that much by renting. Interest rates on savings accounts aren't rising along with mortgage rates for the time being, so any extra money you might have left over by renting isn't going to bring in much. At least not on a savings account.
- Inflation plays to your advantage if you have a fixed-rate loan. After all, your monthly repayment remains the same, while the real value of that amount decreases. Most Belgians' salaries are automatically indexed, so if that's the case for you too, the burden of your loan decreases in comparison to your total income. Conversely, the longer you wait, the more your purchasing power decreases due to inflation. So with the same budget, you will be able to buy a smaller house in the future.
- Building plots will only become more scarce. Belgium isn't magically going to become larger and green areas are much better protected (and rightly so). Here too, we expect prices to rise sharply in the coming years.
- The VAT reduction for demolition and reconstruction continues one year longer, until the end of 2023. There is no guarantee that this will continue beyond 2023 and your house must also be effectively built before the end of 2023. If you include the time of applying for your environmental permit - and that can take a few months - you shouldn't wait months to take advantage of this.
- You may have a right to reduced registration fees. If it is the purchase of your only home, you will only have to pay 3% registration fees. Please note that a Skilpod is new construction, so it is subject to VAT instead of registration duty. This advantage, if you buy from us, only applies to the building plot.
Conclusion: if you have a stable income and the opportunity to buy today, we think it is best not to hesitate too long.
Of course, we hope you choose us mainly because you like our designs, but looking at the above, we see some additional benefits at Skilpod.
- We work with a clear, upfront, all-inclusive price. Like all builders, we regularly index our prices, but that doesn't happen anymore after you sign. You always know what you will pay in total for your turnkey home.
- If you demolish an existing house, your Skilpod will be ready in time to benefit from the reduced VAT. We can build very quickly. Your house will be ready a few months after the delivery of your environmental permit. And we can already start building while your plot is being prepared. By the way, did you know that we can also arrange the demolition of the existing house for you?
- You know in advance what you are buying. In some cities these days, you're already too late if you make an offer on your first home visit. People buy old houses even before they've seen the inside. This can, of course, lead to painful surprises. We don't have a show house yet, but you can visit all the modules in the hall and with new construction you have a 10-year warranty on the construction.
- No bidding wars, no stress when visiting. With us, you don't have to compete with 50 other buyers who come over on the same viewing day and are pitted against each other. We can build Skilpods for anyone who wants one. So take your time and think about it. But don't take too long.
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