What outcome for housing in Luxembourg ?

It must be admitted, the atmosphere is not festive on the Luxembourg real estate market.

Some owners want to sell, but can't anymore.

Developers would also like to sell, but they can't do it either. Some, stuck by the purchase of land at high prices and by the increase in construction costs, have no room to adjust prices and have no way out for the moment.

Many projects are put on hold leading to a decline in construction activity.

Paradoxically, many people would like to buy a property in Luxembourg, but no longer have access to it given the decrease in borrowing capacity caused by the increase in rates. Some are already engaged in a new purchase, but the proportion of lots sold is too low, the funds to continue the projects are not available. The credits run and they have to wait...

As a result, renting is even more popular, but here too, the offer is insufficient. Given the plethora of competing files when a property is available, only the best profiles have a chance.

The decline in the number of sales and rental transactions is also a problem for real estate agencies. On the one hand, they see their revenues going down and, on the other, in connection with inflation, they suffer from increases in suppliers' prices.

Given the uncertain situation, banks are turning off the taps by making access to credit more difficult. Indeed, almost no more bridging loans are granted. Banks ask buyers to sell their property before considering a new purchase. Some banks no longer finance the purchase of properties with poor energy passes if an improvement project is not budgeted. In the future, too, some banks are thinking of re-establishing a system of valuation of assets. In this case, the bank will only follow up to its estimate.

Luxembourg has a strong economy and every year more and more people want to settle there, but without sufficient housing supply, how long can it last? It is the attractiveness of the country that is at stake.

On the side of the public authorities, Minister Kox has put in place a bill with as usual his supporters and detractors. Will it ever be voted on? In the run-up to the elections, each party proposes its solutions.

A new balance will have to be found, for this each link in the chain will have to do its part. How and when, that is the question!

14 Jan 23