When you buy a house, flat or land, you don't just pay the purchase price of the property. There are always additional costs you need to take into account. What exactly are these costs? We list them all for you below.
1. Costs related to the purchase
1.1. Registration duties, also known as selling rights or registration tax
When you buy a house, flat or building plot, you pay registration duties. Those registration fees amount to a certain percentage of the purchase price.
The rates and rules depend on several factors:
Would you like to know how much registration duties you have to pay yourself? Then be sure to check out the site of the Federal Public Service Finance or ask your notary for help.
1.2. VAT instead of registration fees
Are you buying a new house? Then you pay VAT instead of registration duties for its purchase. Are you also buying the accompanying building plot at the same time and from the same seller? Then you also pay VAT instead of registration duties on that building plot. Are you buying the house and the land at different times? Or do you buy the building land from a different seller? Then you pay registration duties on the building land.
Note that if you only buy a building plot, you always pay registration duties and therefore no VAT.
1.3. Notary fees
You will also owe the notary a fee. These fees are fixed by law and amount to a percentage on the value of the property. Every notary therefore works with the same fee.
There is also a fixed amount for administration costs. This is because the notary has to do various research and expenses in order to draw up the deed correctly. Think about the cadastral data, surveying costs, checking whether there is a mortgage on the property...
Is it about a public sale? Then you will pay costs incurred by the notary to announce and organise the sale. These costs are mentioned by the notary right at the start of the sale session.
You also pay VAT on these notary fees. For more information on how this is calculated, visit www.notaris.be or ask your notary.
2. Costs specific to the mortgage loan
Besides the cost of buying your house, flat or land, you will also pay fees for the mortgage loan. For instance, you pay filing and appraisal fees, which vary from bank to bank. In addition, you also pay notary fees for establishing the security, registration right or mortgage right.
For a credit deed with mortgage establishment, the deed must be registered at the competent mortgage office. Besides the mortgage right, you also have to pay a fee for the mortgage registrar for this. This fee, like the notary's fee, is set by the government.
Of course, you want to borrow without any worries, because after all, you are talking about a large amount of money to pay off. That is why it is recommended to take out debt balance insurance (SSV). Debt balance insurance provides full or partial compensation for the remaining amount of your mortgage loan if one of the insured borrowers suddenly dies while repaying the loan. Such insurance is taken out with the lender in most cases.
3. The cost of work (if any)
Have you moved into your new home? Small, unexpected costs may still crop up. To avoid this, it is important for prospective buyers to inspect the property thoroughly before buying! That way, you avoid surprises on the one hand and can properly assess additional costs on the other.
Do you choose to renovate your property for your own comfort or to increase its value? This too will entail additional costs and you are happy to estimate in advance!
4. Annual costs for the owner
The list of costs does not end after the purchase! The new owner will still have to bear a number of annual costs:
4.1. Property tax
Property tax is the tax calculated based on the cadastral income of the property. The property tax rate varies depending on the region and municipality where the property is located. For example, provinces, agglomerations and municipalities have the right to increase this basic tax by opcents. You can calculate the property tax with this handy tool from the Flemish government.
4.2. Insurance
It is not compulsory to take out insurance for your home in Belgium, but it is highly recommended. Besides the debt balance insurance mentioned above, there is also home insurance or fire insurance. This protects the buyer in case of a claim such as fire, flood, theft, etc.
Compare insurance costs and deductibles carefully! These can vary greatly from institution to institution.
Credit institutions sometimes offer borrowers the opportunity to reduce the interest rate on their mortgage if they also take out home insurance with them.
4.3. Maintenance costs
The value of your home is greatly determined by its maintenance. Think of minor repairs or work after any damage, but also the maintenance of the boiler... We recommend setting aside a small amount each year for repair work. That way you will not be faced with too many surprises.
5. Co-ownership fees
Costs related to co-ownership only apply to owners of a flat in a multi-unit building.
This is because these owners also have to bear part of the maintenance costs of the entire building. These costs can be for: cleaning common parts in buildings, lift maintenance, common energy costs...
Also in case of major repair works (facade, roof...), all owners have to contribute to the costs. Reserve funds are set up for this purpose and financed by an annual contribution from all owners. This contribution also compensates the building's trustee.
6. Specific costs when purchasing new construction
6.1. VAT on purchase
You only pay VAT on the construction part of your new home, which is usually 21%. On the land part you pay 12.5% registration duties.
6.2. The cost of the basic deed
Again, this only applies to the owner of a flat in a multi-unit building. All owners together pay for the creation of the building's basic deed. This deed sets out the rights and obligations of each owner, as well as the rules of co-ownership. Together, these form the building's bylaws. The basic deed contains an accurate description of the private parts of each flat, as well as the number of units in the common parts attached to them.
6.3. Connection charges
An important step when buying a property is the connection of the various utilities (water, gas, electricity, internet). This involves costs, which again are the buyer's responsibility.
So, we hope with this blog to give a clear overview of the costs involved in buying a house, flat or land!
Do you still have questions? Please do not hesitate to contact us for further info or questions. You can do so at familie@albert.immo or on 0468 245 245.
With Albert, you come home!
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