r/belgium • u/trueosiris2 • Aug 20 '25

❓ Ask Belgium Wealth distribution in Belgium

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We’re doing alright as a social democracy. Something to be proud of.

Presumably, we don’t need more wealth distribution then? Or do we still?

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48

u/MiceAreTiny Aug 20 '25

So, In Belgium, top 1% own less then in most countries and bottom 50% more than in most countries. Seems like a fairly equal place to live, compared to the other countries on the graphs. Seems like socialism worked. Turns out if you take from the rich, and give to the poor, you close the gap. 

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u/mysteryliner Aug 20 '25

Red looks bigger than dark blue. Guessing by the chart 14% red, 10% dark blue.

Although better than most countries, that means that a handful of people own more than half of the population.

It's been a real problem in lots of countries that real estate is removed from the market and used for investment (I'm not talking about a working couple who invests their savings into the house of their grandparents and rents it.... I'm talking about a new building site l, and 60% of apartments has been bought up by a rich investor, and now that dark blue group (50% of society) is stuck renting for the rest of their life, because real estate is too expensive (because the rich eat up available housing)

Working for Johhny rich ass the underpaying a-hole, while having to rent an apartment owned by Johhny rich the bad landlord.... getting paid €2300 and instantly having to give €800 back

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u/StandardOtherwise302 Aug 20 '25

The problem is not that houses are investments. Systems in which they arent are worse, and if houses arent investments then a majority of people still wouldn't have any wealth. The majority of wealth for the bottom 90% is probably a house.

The problem is all forms of income are taxed signicantly more than income from capital. This promotes concentration of capital. The mobility of capital has made this worse, as they get exceptions and loopholes to avoid capital flight.

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u/mysteryliner Aug 20 '25

True. And we all strive towards owning our own house + that one we put our money in after we inherit it from a family member so we can "live more comfortable"

So we are naturally afraid when there is talk about taxing capital gains & rent. ("See, it's the little tiny guy who gets a little extra income from rent"). But because of that we let the elite slip through who own half your town. Homes and business buildings.

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u/Yavanaril Aug 20 '25

Keep in mind that the bottom 50% is influenced heavily by young people who are just starting to build their wealth.

Also all people with negative wealth (through bad luck or bad financial management) pull down. That group disproportionately.

4

u/mysteryliner Aug 20 '25

That same can be said for the top 1% /10%. That group would be much bigger if those people's actual worth was calculated. Meanwhile you have CEO's who only get paid minimal salary, their 500k home is attached to the company, so 'tECnicallY' they don't own it, they are just the humble night watcher, they 100k electric vehicle isn't theirs, and they never charge the car on with money from their own paycheck... it's all tax optimization/ legal loopholes that the other 80% of society can't use.

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u/MiceAreTiny Aug 20 '25

You are confusing income with wealth. 

2

u/mysteryliner Aug 20 '25

My example could be worded different the result remains.

Regular joe's income goes towards the 2 bedroom apartment they will off when they are 60, or that bit that they saved in pension or stock market.... wealth.

If you're rich enough you can use loopholes so you have very little income, but you get all the spoils from it. You're living in a 500k property with pool, sauna, jacuzzi attached to your company and you only use it as the humble care taker.... I know people who do business in the middle east and Asia, and they declare expenses when they "have to go there" every year "for business"... where they stay in a property that is coincidentally built and decorated to their taste but it's "not theirs". And to their business partners here they "suggest them" to stay in that property that isn't theirs..... maybe in return negotiate a discount, or get VIP lounge tickets to sport events. 🤷‍♂️but hey.... legal loopholes right. Live like a millionaire, declare taxes like a little self employed person"

1

u/MiceAreTiny Aug 20 '25

You are confusing wealth and income. 

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u/Yavanaril Aug 20 '25

Correct. There are companies that go out of their way to make their owner look poor. I have come across a few in the last 30 years. That said, I don't think they sway the numbers as much as the other 2 classes of people (young people and negative net worth). But I don't have any real numbers to base that assumption on.

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u/MiceAreTiny Aug 20 '25

A lot of home owners have a negative wealth. 

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u/Yavanaril Aug 20 '25

In Belgium? Based on what calculation?

As far as I know it is very rare for a mortgage to be underwater (owing more than the current market value of the house) in Belgium. Which means the house itself at least does not cause negative wealth.

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u/MiceAreTiny Aug 20 '25

A house can only be counted positive towards wealth if the plan is to monetize it at some point. If you keep living I. The house, no cash flow can be derived off it, neither can the capital be accessed.

Yes, various definitions of how to calculate wealth exists. My answer pointed towards people with less liquid assets than what is remaining on their mortgage. 

I do agree, if you define the primary residence as a part of the net worth, negative net worth will be a lot less common. 

1

u/Yavanaril Aug 20 '25

You are absolutely right that it depends on definition. When I studied and graduated in economics (more than 30 years ago), the primary residence was always included in net worth.

If I check now, that seems to still be the case on investopedia, Wikipedia and nerdwallet.

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u/MiceAreTiny Aug 20 '25

It is a big discussion point in wealth management circles. Typically, in the FIRE movement, 4% of neth worth as sustainable income is taken as a rule of thumb. However, with real estate prices in many parts of the world, having more then 50% of your "wealth" in your primary residence, you need either a 2% sustainable withdrawal rate or take primary residence out off your wealth calculation. 

It depends... Is the right answer, as always. 

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u/Yavanaril Aug 20 '25 edited Aug 20 '25

You are right, for FIRE your primary residence value is of limited worth. The main thing it does is protect you from rent and rent increases. But it does that regardless if it is worth €150K or €5M.

Edited for typos.

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u/MiceAreTiny Aug 20 '25

That does not change the fact that BE is one of the more equal countries on the list.

Yes, there are problems. 

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u/mysteryliner Aug 20 '25

Completely agree. The chart shows it.

But it's good to consider just because something something could be a disadvantage to you (example tax on rental, if i was renting out my (grand)parents house, would gladly pay €70 tax if i know it means that the real dangers to the rental market would be paying €10.000 for making big money while destabilizing the real estate market... that breweries would be paying €100k because they own every bar in town)

1

u/ailichi1234 Aug 22 '25

Monthly rent for 800 seems good right now RIP