In Belgium

A capital loss occurs when a property is sold for less than its acquisition price (including notary fees and registration duties). In Belgium, for individuals managing their private assets, capital losses on property are not tax-deductible and cannot be offset against gains realised on other properties.

This asymmetry is notable: the tax authorities can tax a capital gain realised within 5 years, but offer no deduction for a loss in the same period.

Capital losses can occur due to:

  • Market downturn: a general decline in property prices
  • Deterioration: neglected maintenance reducing the property’s value
  • Environmental factors: new infrastructure reducing attractiveness
  • Structural issues: hidden defects discovered after purchase
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Good to know
A capital loss is only crystallised at the moment of sale. As long as the property is not sold, the loss remains theoretical (unrealised loss). Market fluctuations do not affect your tax position until a sale occurs.

Practical example

Marc bought a studio in Charleroi in 2020 for 95,000 EUR (+ 12,000 EUR in notary fees). Due to a factory closure in the neighbourhood, he is forced to sell in 2025 for 80,000 EUR. His capital loss is 27,000 EUR (107,000 - 80,000). This loss is not deductible from his taxable income.

Key considerations

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Warning
Even when selling at a loss, the seller must still pay notary fees and potentially estate agent commissions on the sale. These costs worsen the effective financial loss beyond the nominal capital loss.