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Shaking Hands Over The Purchase Of A House

Moving out of our first rental appartment, also our last?

It all started in November 2020 when we had to decide where to stay after I learned that my apartment in Brussels would face a 10 to 12 month (!) delay due to corona -although I’m very doubtful it’s just because of that- and that my wife would deliver the end of May 2021.

While the 40m³ rental apartment works for 2 people, even amidst a raging pandemic, such a small place is impossible for a family of 3.

Finding a new home for 3

We had no other choice than to look for a new place to stay.

At first, we thought it would be possible to rent something short-term, but we quickly flung that idea out of our second-story window as there was no way to find a reasonably priced short-term stay anywhere in Belgium. Either it was at least 1 year and more, or it was crazy expensive per month. Think over 1K for a 1 bedroom apartment.
On top of that, after staying in a 40m² apartment we really didn’t feel like moving to another apartment. But what else was there to do? How could we bridge the gap between pregnancy, the delivery, and the delivery of the apartment?

Parents to the rescue!

When I moved out of my parents’ house, I never thought I would ever contemplate moving back in, let alone with a pregnant wife.
Yet there we were, living in our tiny flat, thinking of just that.

Realizing that moving to yet another rental apartment was not interesting, the next thing that came to our mind was staying at my parents. It wasn’t ideal by any means, but at least we would save money and live in a house with enough room for 5. However, the problem was the duration of our stay. 1 month? Fine, 3 months, doable, but 1 year? Yeah… nope.

Staying with my parents for 1 year, of which 6 months would be with a newborn, was just too long.

Staying at my grandmother's house

During a video call with my parents at the end of November on how things were going and what we would do about our housing problem, my dad suggested my grandmother’s house.

He didn’t see any issues with it, and he even suggested helping with minor repairs, especially after it being uninhabited for 2 years. Of course, he had to check with his brothers/my uncles as they inherited the house together, and well, we are in it so it clearly wasn’t an issue.

But why was it available in the first place? You would think the house would be sold right after my grandmother passed away, but taxes decided otherwise.

Why wasn't the house sold?

When declaring inheritance taxes, a value must be determined for the inherited real estate. The tax authorities will use this value as the basis for calculating inheritance taxes. Once you have definitively inherited a property, you are free to choose whether to sell it, provided that each heir agrees to this, of course.

But if you decide to sell the property for a steeper price than the agreed value -which they want to do- you will have to pay additional inheritance taxes and a fine to the tax authorities.

If they want to avoid these additional taxes, they have to wait with selling the house. The tax authorities can only claim additional inheritance rights up to two years after filing the declaration. So, if you postpone the sale, you may sell the property for a higher price than that stated in the declaration.

Yet another move

We were elated knowing that the house was available and getting the green light to move into my grandmother’s house signaled the start of our move. This was at the beginning of December. We canceled our rental agreement right away so that we could officially move out no later than 8 March. There is a 3 month waiting period after all.
Next to the waiting period, we had to pay a fine of one month’s rent. Because the cancelation was before the official end date but we were already renting for over a year, the fine was ‘only’ 1 month’s rent. We happily paid that knowing we would be out of that tiny dwelling.

Over the course of those three months, we would start cleaning up my grandmother’s house, I and my dad would make some improvements. Just like that, 3 months flew by.

And maybe our last one

Could we have moved faster? Probably. If we had rented a van, the moving of our stuff would have gone faster, but since we had the time we decided to do it with my car.

It did make the transition feel more tedious and it definitely gave us the feeling that we didn’t want to go through that again. Does this mean we will stay here indefinitely? Hard to say.

There are a number of questions that remain unanswered till at least the end of the year:

  1. Will we like the area? It’s one thing to remain here temporary, it’s another to actually live here for years.
  2. Can my wife find a job by the end of the year? With only one salary, it will be difficult to convince banks to give a second mortgage to buy the house. On top of that, how much rent will I get out of the Brussels apartment?
  3. When my wife finds a job, where will it be? If it’s in Brussels, the current location is good, but if it’s, let us say Antwerp. Does it make sense to live so far away?
  4. Will we have enough for a downpayment? Even if we can borrow 90% of the amount needed.

These questions and probably more are important factors to consider before we can buy anything.

Sources:

  • https://www.dewaele.com/nl/advies/ik-heb-samen-met-familie-een-huis-geerfd-en-wil-dit-verkopen-wat-moet-ik-d

I'm a developer for a major financial institution in Belgium that is present in over 40 countries. I have over 8 years of working experience in the development of customer applications focussing on all aspects of banking. This helped me gain a deep understanding of the inner workings of a commercial bank. All of this experience in both banking and life culminates in this blog about personal finance and my fight towards FIRE.

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