Flemish interest in lease-purchase homes grows

The popularity of rental properties, where houses are first rented with an option to buy in the future, is on the rise as the Flemish housing market is becoming less and less accessible to many families. However, supply cannot keep up with growing demand.

More and more young families are finding it difficult to buy their first home due to rising mortgage rates and rising house prices. This leads to greater interest in the rental market. Lease-purchase offers these families a solution: they rent a home and have the option to buy it later for a predetermined amount. This is a godsend for families who do not have the immediate means to buy a home or take out a mortgage.

BNP Paribas Fortis and property developer Matexi introduced their rent-to-own concept called HappyNest this spring. The initiative offers around 100 homes in several Flemish regions. After five years of renting, tenants can decide whether they want to buy the property. In doing so, they can get back up to half of the last four years' rent if they decide to buy.

However, the concept is not without risk. If house prices fall, you may end up paying more than the current market price when you buy.

Demand for this type of housing significantly exceeds supply. HappyNest reported more than a thousand potential buyers on their waiting list, leading to expansion of their supply in other Flemish regions. The joint venture, Hamsterhuren, introduced the rent-to-own model five years ago and is also seeing a significant increase in demand. They currently offer around 700 rent-to-own properties, with a waiting list of more than 20,000 people.

There are also new players in the market, such as Brussels-based Koqoon, which propose a different model. With Koqoon, one can designate a desired property, which Koqoon then purchases and rents to the interested party. Later, the tenant can buy the property from Koqoon at a pre-agreed price. An innovative alternative that is also emerging in the market is Immotokens. They make it investing in lease purchases also accessible to private investors. They have an online investment platform where investors can participate in property investments. Thus, they are one of the alternatives to hire purchase.