Young buyers priced out as house prices overtake purchasing power

30 January 2026

High interest rates and rising prices mean that houses are historically expensive compared to average purchasing power. Young first-time buyers in particular are finding it harder to buy a home, De Standaard writes.

The sharply declining affordability of housing is clear from a calculation by real estate expert Frank Vastmans of KU Leuven. This includes everything that affects affordability: house prices, interest rates, income and taxation.

The calculation shows that buying a house in Flanders has not been as unaffordable as it is now for at least three decades. Unaffordability peaked in the early 1980s, when buyers had to pay more than 10 per cent interest.

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In 2024, the price of an average home relative to the average budget was a third higher than in 2019. The situation has not improved today, Vastmans notes.

The decreased affordability has several causes. High interest rates significantly reduce the amount a first-time buyer can borrow. Those borrowing at 25 years with a fixed interest rate pay an average of 3.9 per cent interest today, figures from Immotheker show. Five years ago, it was 1.6 per cent.

"Flanders is already packed, it’s true. But you don’t necessarily have to take up open space"

With a monthly repayment of 1,200 euros, a buyer five years ago could borrow 66,000 euros more. The higher interest rate wipes out gains from the rise in income.

The Flemish coalition agreement states that affordable and quality housing is a priority. CD&V leader Sammy Mahdi said last week that every working person in Flanders should be able to buy a house before the age of 30.

The only way to keep housing affordable is to boost supply, said Peter Vanden Houte, chief economist at ING Belgium. “Flanders is already packed, it’s true,” he told De Standaard. “But you don’t necessarily have to take up open space. You can densify, build more in height or make better use of the current housing supply.”

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