brussels Landlords‘ Costs Substantially Higher Than Tax Assessments Suggest
Recent research sheds light on the financial realities faced by landlords in Brussels,revealing a significant discrepancy between actual property expenses and the figures used for tax calculations. Historically, studies have focused on tenants, leaving a gap in understanding the costs borne by property owners. This new study aims to fill that void.
Researchers gathered data from 15 Brussels landlords regarding 22 properties, tracking all maintenance and repair costs over periods ranging from one to fifteen years. The study also factored in the time landlords dedicate to property management.
The findings indicate that median maintenance and repair costs – encompassing everything from routine upkeep to boiler and roof repairs, and elevator expenses, but excluding major renovations – currently amount to 10% of the rent received. However, the State currently bases its calculations on maintenance costs estimated at 40% of the cadastral income established in 1975, an amount only indexed for inflation since then.
This significant difference is a key concern for the researchers. Aligning tax calculations with current maintenance realities would mechanically increase cadastral income,impacting landlord taxation and,consequently,public finances.Beyond basic maintenance, landlords face additional expenses. These include land taxes, which average around 25% of the rent, alongside insurance and potential property management fees. When combined, these costs typically consume 40-50% of rental income, leaving landlords with a net rent representing 50-60% of the gross amount.
The study also quantified the time commitment required of landlords. Owners dedicate approximately four hours per month, per property, to tasks such as tenant relations, administrative procedures, and general management. When calculated against the net rental income, this equates to a theoretical “hourly wage” of around 400 euros.
