The Mortgage Market in Belgium

The strong performance of the Belgian housing market has been boosted by the country’s strong economic growth. The mortgage market has grown at an accelerated speed since 2001. The competition among banks and the conducive interest rates contributed to fuelling the increase of mortgage loans. Mortgage rates reached record lows between 2003 to 2005; however, the interest rate hikes implemented by the European Central Bank allowed mortgage rates to rise to 4.97% in 2007. In Belgium, majority of the housing loans fall under fixed rate mortgages.

Belgian housing market

Belgian housing market

However, between 2003 and 2005, an increasing number of households preferred to take adjustable rate mortgages. Taking the recent interest rate rises into consideration, households drawing up new contracts began to choose longer term FRMs. In 2007, over 90% of the new mortgage contracts were FRMs. Notwithstanding this, the Belgian housing market is still highly exposed to interest rate hikes, on account of the ARM contracts prior to 2007.


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