Buying property in Belgium


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Initial agreement between the seller and the buyer - Before Contract

What form can this agreement take? Preliminary contract?

The agreement usually takes the form of either an option or an agreement of sale (compromis de vente), i.e. a preliminary contract

In the case of the option, it may be an option to sell. In this event, the owner promises to sell the real estate at a set price (unilateral promise to sell). The owner is bound to this commitment for the term of the option and may not sell to another person. The buyer, for her/his part, is not obliged to buy. In some cases, the seller will ask the buyer to ‘commit’, i.e. to offer a price that the seller may accept or reject.

The agreement can also take the form of an agreement of sale or preliminary contract. However, in reality, as soon as the parties have signed this document, the sale is final; the parties may no longer change their minds. The sale will not take effect against third-party claims until the moment that the authentic instrument is filed with the mortgage records office.

According to federal law, the preliminary contract must contain certain information. Depending on the region where the property is located (Brussels, Flanders, or Wallonia), other additional things must be mentioned in the agreement. For example, in Brussels, information about the town planning permits and certificates, any violations regarding the property that may exist, etc., must be indicated in the preliminary contract. The preliminary contract may also include some conditions precedent or subsequent (e.g. linked to getting a mortgage loan). It is thus a very important document for which legal counsel is necessary before committing oneself.

With whom must the parties (buyer/seller) formalise the initial agreement? Is a legal form imposed?

A legal form is not required. The Civil Code effectively stipulates that the sale is final between the parties as soon as the sold property is specified and the price is set, even if the said property has not be delivered or the price has not been paid (Article 1583 of the Belgian Civil Code).

In contrast, to be valid against third parties, the sale must be consigned to an authentic instrument and filed with the mortgage records office.

You must also be mindful of the tax consequences, as the code on registration fees provides for the sale agreement to be registered within four months of being signed. (The notarised instrument must thus be concluded within this deadline to enable the notary to register it. Otherwise, the parties will have to register the sale agreement themselves.)

What are the legal effects of this preliminary contract? Is a preliminary contract necessary?

In the case of an option, a unilateral promise (to buy or to sell) arises on just one of the parties. The other party enters into a commitment by taking up the option, if s/he so wishes.

An agreement of sale or sale agreement, on the other hand, is a reciprocal commitment to which each of the parties is definitively bound. The seller will no longer be able to sell to someone else who offers a higher price, and the buyer will no longer be allowed to renege on the agreement.

These commitments are often accompanied by conditions precedent (the offer or the agreement does not exist as long as the condition is not fulfilled: for example, obtaining a mortgage loan) or conditions subsequent (the offer or compromise exists but if the condition is fulfilled, the sale may be cancelled/terminated). These are also called ‘suspensive’ and ‘resolutory’ conditions, respectively.

The law requires the inclusion of more and more additional clauses in the sale agreement (and even in the advertising that is done when property is put on the market).  Legal advice from a professional such as a notary is thus strongly recommended.

Are there amounts to be paid, and to whom? Can these amounts be repaid?

There is no legal obligation to pay any amount at the signing of the sale agreement, but a security deposit or down payment is traditionally paid. As a rule, it is 10% of the agreed price.

This payment is a guarantee for the seller. In most cases, the sale agreement will stipulate that the seller may keep this money as lump-sum pecuniary damages if the sale is rescinded against the buyer in tort.

The buyer may also demand a guarantee for this down payment to be ‘consigned’, i.e. held in escrow. For example, the down payment/security deposit will be deposited at the notary’s office, where it will be kept pending the signing of the authentic instrument.

Are there any consumer protection measures (cooling-off period, right of withdrawal)?

Belgian law makes no provision for a cooling-off period or right of withdrawal, hence it is of great importance to consult a specialist such as a notary before signing a document (sale agreement, option, etc.) in order to know exactly what you are committing yourself to.

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Conseil International du Notariat Belge

Rue de la Montagne, 30 - 34

B-1000 Bruxelles


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