“Affordable owner-occupied home is a real challenge today: Is annuity or a buy-to-let solution? | MyGuide

The energy crisis and high inflation have had a huge impact on our budget in recent years. We’re still feeling the consequences and that doesn’t make buying a home any easier. In addition, the renewal commitment was introduced at the beginning of this year and mortgage interest rates have gone up. So it doesn’t seem like the best time for potential buyers. How do you keep it all on hand?

Renovation commitment, price increase and scarcity of building land: Will it become too expensive to buy a house in Flanders?

Rising interest rates and rising material prices pose many challenges for potential buyers. In addition, the renewal commitment was made at the beginning of this year.

This measure requires homeowners to at least renovate their homes to a D energy label within five years of purchase. Although seeking a better rating—if you have the finances—is adequate to meet the 2050 requirements. Read here what you definitely need to know about the Renewal Commitment 2028.

Then there is the energy crisis which has had a huge impact on the family budget. Saving energy and making your home more energy efficient has never been more important. But you need a big budget for an energy renovation or to buy an energy efficient home. Recent research by BNP Paribas Fortis shows that the purchase price of a house with the EPC label A is on average €84,000 higher than a similar house with the label G.

What is its price? What is its validity period? EPC in short.

If you buy a house or apartment on an annuity, you pay the seller a fixed monthly amount. This is as long as the seller is alive or until the predetermined maximum period expires. So if the seller dies early, you’ve been able to get a house pretty cheap. The monthly price is determined according to a number of criteria, such as the seller’s age, property value, interest comparison, and so on.

You pay in advance, the so-called package or bundle. This is usually 10 to 15 percent of the property’s value. The package is subject to the age of the seller. The older he gets, the higher the progression. On the other hand, you have a resident annuity, in which the seller retains the usufruct. On the other hand, you have an unoccupied annuity, a buyer can come and live in the house.

Arithmetic example
Suppose you want to buy a terraced house in the vicinity of Brussels via Trevi with a occupied annuity. The value of the property is estimated at around 400,000 euros. The listed house is 135 sqm and has three bedrooms. The package for this house is 50,000 euros. Annual installment 1,200 euros per month, maximum term of 15 years and seller’s age of 75 years. Let’s say the seller lives another 10 years. Then you pay €194,000 for the property (€144,000 + €50,000 up front), excluding costs and cataloging. After that, the house is yours and you will pay nothing more. If the seller lives another 20 years, you pay €266,000 (216,000 interest + €50,000 upfront) because the limit is 15 years.

And suppose the same property is offered by an unoccupied annuity. Then you pay a package of 50,000 euros and pay interest of 2,200 euros per month for a maximum period of 15 years. Is the seller still alive and the 15-year period has expired? Then you pay €446,000 (€396,000 interest + €50,000 package) for the listed house in Brussels. If the seller dies early, say after five years, you pay €182,000 (€132,000 interest + €50,000 package), excluding costs and indexing.

If you choose to purchase a home via rental purchase, you are first renting the home until you can purchase it afterwards. This principle has been around for some time, but the supply is rather limited. Construction company Matexi and BNP Paribas Fortis launched the “HappyNest” rental purchase formula at the end of May, which operates on the 3-6-9 principle.

After five or six years of renting, you get the chance to become the permanent owner of a new energy efficient home. There is no obligation to purchase. So you can choose to rent for a longer period and save more or leave the premises. Do you still want to buy the house? Then you pay the purchase price minus 50 percent of the rent you actually paid.

With this formula, Matexi wants to make buying energy-efficient homes even easier. “The cost of affordable housing, taking into account purchase and energy costs, is a real challenge today. By launching HappyNest, we want to give a wider audience the opportunity to buy their own energy-efficient home, ”says Olivier Lambrecht, CEO of Matexi.

Arithmetic example
Let’s say we want to buy an energy efficient half-open Matexi building of 309 square meters in Houthalen-Helchteren with three bedrooms, garage and garden shed for €316,000. With a rental purchase, this comes to an estimated rent of €1,100 per month. Four years later, I’ve paid a total of €52,800 in rent. If you decide to buy, you’ll still pay 289,600 euros: 316,000 – 26,400 euros (50 percent of 52,800).

Read alsoWould you buy this house or not? It is up to you to decide if it meets your expectations and fits your budget. This checklist will definitely help you make that decision.

Do you want solar panels, but are they currently taking up too much of your budget? Then you can get a subscription with solar panel provider Otovo. Originally a Norwegian company, but has been active in Flanders since December 2022 and in Wallonia since June 1.

concept? Otovo acts as a “quality checker” and offers the best solar panel price in your area. Under a 20-year subscription formula, the company installs, maintains, and monitors the solar panels on your roof. This way they want to keep their energy bill low and predictable. “People know what they are going to pay for electricity in the next 20 years,” said Cedric Sevier of Otovo.

We want to democratize solar panels and make them more affordable. Otovo remains the owner of the solar panels for the duration of the subscription, but you have the option to purchase the solar panels every month.” The subscription amount already paid will then be deducted from the purchase price.

“We are not a financial institution, but we make it possible to spread payments and unburden you. In the meantime, you can enjoy self-produced electricity and save on your energy bill. Although energy prices have stabilized and the urgency to install solar panels has decreased. We still need to move towards a housing stock climate neutral.”

Solar panels on your roof? This is the number of amounts for the cost price, payback period and premium.

Arithmetic example
Let’s say we enter an online address in Diest, Flemish Brabant. Otovo searches for service providers located in the area and offers the best rates. We will pay 58€ per month for 10 standard solar panels with a capacity of 415 watts per solar panel. This results in an annual output of 4,400 kWh. We will save between 80 and 110 euros per month.

How much you save depends, of course, on your monthly consumption. But you can also enter that online. Based on your consumption, Otovo makes an estimate on a monthly, yearly, and 30-year basis.

And suppose that after five years we have the financial means to buy solar panels. After that, the months already paid for the subscription will be deducted, and all the benefits of the formula (maintenance, monitoring …) will also end and we will finally pay another 5,500 €.

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