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Are we heading for a rise in property prices?

Real estate advertising portals are once again seeing more traffic.  Credit brokers and banks are also seeing a surge in activity when it comes to enquiries from prospective buyers. Key rates are trending downwards. 

Good news to the point that some are already announcing a future increase in housing prices.

Oh, really?

Let's not forget that while the existing market has restarted, the new construction market is still almost at a standstill.  Buyers' interest in new construction remains low.  This is due to prices that have not adjusted as much as in the existing market and uncertainty about delivery times (except for projects that have already begun).

Regarding the existing properties, we are in an area where transactions can occur again.  On one side, we find falling prices and on the other, lower interest rates, wages indexed several times and improved government aid.

No, for the moment, there is no question of a price increase.  On the other hand, we may well have reached the end of the decline.  Rather, we are witnessing a stabilization. 

In the longer term, considering that the supply of housing is much lower than demand in Luxembourg, logically, prices should rise.  This housing shortage is only getting worse since many new homes are not being built at the moment. 

In reality, no one can predict with certainty how prices will evolve.  Many external factors play a role.  Who knows what the world will be like tomorrow?

Is now the time to invest?  Our advice is always the same, if it's your moment and you have the opportunity, seize it, it's the best way not to have regrets in a few years!

Written 18 June 2024


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