Whether your circumstances have changed or you're seeking to make the most of soaring house prices, this guide covers the what, when and how of selling.
How much is my house worth?
Let's start by working out the value of your property. House prices in the Grand Duchy remain sky-high, so are you on track for a windfall if you decide to sell?
The valuation process is best done in stages, starting with the least effortful and advancing to something which actually involves getting off the sofa:
Step one: start with a very rough estimate. Check here to find the price per square metre of property in your area, then simply multiply that figure by the area of your property. Don't know the square metre figure for your place? Dig around for your property plans or take a guesstimate based on similar properties being advertised online.
Step two: refine your estimate using an online tool. Fill in the details of your property: how many bedrooms? is there a garden? space to park a car? And so on. Then you'll get an initial idea of what it's worth in today's market. Try the online calculators atHome.lu or immotop.lu.
Step three: assuming you're happy with the results, arrange for at least one (ideally two) in-person valuations with an agent. The two portals above can send an agent around, or you can contact any estate agent of your choice to arrange a visit. Remember that you are under no obligation to actually list with an agent just because they've provided an estimate, so don't feel any pressure to do so!
Finding an estate agent
Valuations done, it's time to decide on an agent. Irrespective of who valued your home, pick an agent based on their merits.
If you've got a standard property, it's worth picking an agent who works locally and so knows the area. But before signing on the dotted line, make sure they're properly registered with a professional association such as the Chambre Immobiliere. They must also hold a business permit, so do clarify this with them if their credentials are unclear.
For specialist property (got a castle to sell?) look for an agent which has successfully dealt with similar properties in the past. A chateau will likely take longer than the average three months for a house sale in Luxembourg, so you'll want an agent who understands the unique features of your property.
Admittedly, most of us don't have fortresses for sale - but this applies also if your property has other unique features, whether that's an unusual layout or it lies on a flood plain. Make sure the agent understands your circumstances before committing.
Most agent contracts last for six months, with an automatic renewal unless you give notice by registered post. If you sell your house in this period (even without the agent), they'll be quids-in on the commission.
Sales commissions are regulated in Luxembourg, and are set to reduce from the current level of 3% of the final sale price plus VAT.
If you're unhappy with your estate agent for whatever reason, you can withdraw from the contract. However, this usually incurs some penalty to cover work already done, so do read the contract before signing it. On a practical note, if the contract is in a language which you're less familiar with, bring along a friend who can read it for you.
Lastly, you don't have to hire an agent. You can choose to sell privately, and advertise it yourself through online portals and directories. You'll still need a notary though - more on that below.
You've valued your house and lined up an agent. Now make sure these documents are in order to avoid legal tangles or delays:
- Proof of ownership.
- The energy certificate for the building (Certificat de Performance Energétique) issued by an architect or authorised company.
- Property plans, with a square metre figure for the habitable area and for additional areas such as any garage, garden or terrace.
- Land registration number (registre cadastral). This can be obtained via Geoportail.
- Copies of recent invoices for property refurbishment or improvements. If you live in an apartment, the recent minutes of general meetings may also be required as evidence of planned improvements.
- For newer properties (less than 10 years old) evidence of the 10-year guarantee.
- Copies of recent utility and insurance bills.
Accepting an offer
The documents are in order, the house has been listed and, lo and behold, an offer comes in.
You can always turn the offer down, of course, but assuming you're happy to accept it, here's what comes next.
First, you will sign an initial contract (compromis de vente) with the buyer, which will list the details of the sale including any fixtures and fittings to be included, the purchase price including fees, and details of the notaries (see below). The contract must also include the date by which the buyer must secure financing, such as a mortgage, and the date of planned completion (when the actual sale occurs).
It's a good idea to use an estate agent if you're unfamiliar with contract law, as you'll want to make sure your compromis includes appropriate let-out clauses and penalties of the buyer later pulls out. A standard penalty is 10% of the agreed sale price plus the agent's commission.
Sealing the deal
Whether or not you've gone with an estate agent, you'll need a notary. They charge fixed fees so you can choose whoever you prefer for this work. If possible, ask friends or family who've bought or sold recently for recommendations, as some notaries are faster than others. Notaries are listed here.
The notary will carry out all the requisite legal checks for both buyer and seller and then, assuming all looks good, you'll head to their office to sign the final deed of sale with the buyer.
Sale done - congratulations are in order! But there's also a couple of admin tasks still to complete. Luxembourg law requires sale agreements to be reported to Inland Revenue, which can be completed via guichet.lu. They will check that the tax treatment from the sale is properly recorded. They'll require supporting documents including a copy of the deed of sale and any invoices proving investment in refurbishing or improving the property.
Tax treatment differs depending on your current situation and residency status, so do check the latest advice on guichet.lu or contact the relevant section of the tax office with any queries.
One tax to be aware of before making a sale is capital gains. This applies to the sale of any property more than two years after it has been acquired. If the value of that property has gone up, capital gains tax applies up to a maximum rate of 21%. Again, the specifics can get complex, but it's worth keeping in mind before making that decision to sell.