Cushman & Wakefield has released The Income Era, its new report on the European Living sector. The report shows how Living has become a core institutional asset class and argues that future returns will rest on income growth rather than yield compression. For Belgium, it points to solid long term demand, a tight supply side and a growing need for efficient, well run assets.
BELGIUM SHOWS SOUND DEMOGRAPHIC FUNDAMENTALS
Across Europe, population growth, urbanisation, smaller households and affordability pressures continue to support housing demand. The share of one adult households in the EU has risen steadily since 2009.
- Belgium’s population is forecast to grow between 2025 and 2035, placing it in the upper half of the 19 countries analysed, ahead of France and Germany.
- Belgium ranks eighth of 19 countries for forecast growth in the over 75s population. This is a clear signal for senior living, a segment that has so far attracted less investor attention in Europe.
- Brussels is projected to grow over the next ten years at the same pace as Copenhagen, ahead of Munich, Frankfurt and Amsterdam.
CONSTRUCTION COSTS IN BELGIUM ROSE FASTER THAN THE EU AVERAGE
Structural undersupply remains the defining challenge for European housing. Development pipelines sit below historical norms and supply demand imbalances are likely to persist or even worsen over the medium term.
- Residential construction costs in Belgium rose more than the EU average between 2020 and 2025, the sixth highest increase of the 19 countries shown.
- Planning constraints, labour shortages and high finance and development costs have weighed on housing starts and permits across many markets.
- Policy attention is turning to development viability, with public lending, development finance and public private partnerships under discussion.
INCOME AND OPERATIONAL EFFICIENCY WILL DRIVE RETURNS
Living delivered an average total return of 6.4% a year over the past twenty years, with the strongest risk adjusted performance of the major property sectors. With interest rates expected to stay at or slightly above current levels over the next five years, the room for further yield compression is limited.
- European multifamily NOI yields stood at 3.0% at the end of 2025, so a total return of 6% to 7% requires NOI growth of 3% to 4% a year.
- Over the four years to December 2025, the most cost efficient quartile of assets delivered a total return of 3.9% a year, against 0.9% for the least efficient.
INCOME AND OPERATIONAL EFFICIENCY WILL DRIVE RETURNS
Belgium combines growing demand, an ageing population and construction costs that have risen faster than the EU average. This makes the European findings highly relevant for Belgian investors. The report recommends building underwriting on income growth, with rental growth close to inflation, and giving operating costs, building age and energy efficiency as much weight as location in due diligence. For developers, energy efficient design is now a commercial advantage as well as a regulatory requirement, while for operators cost control has become a core driver of returns
Download the full EMEA report here.
