"We are in the midst of a construction crisis," says Marc Giorgetti

Despite the growing demographic in the Grand Duchy, which is necessary to keep the social system running, the housing market continues to encounter difficulties.

Sales have virtually reached zero, and the housing market is "blocked", Marc Giorgetti told RTL. The CEO of Felix Giorgetti warned that a lack of investment will lead to stagnation in the construction sector, predicting that just 2,000 new homes will be built annually over the coming two years - a figure which falls short of the necessary 4,000-5,000 required to meet demands. Even foreign investors - known as the "Jupiler League" in the sector - have stopped purchasing in Luxembourg.
Rising interest rates has led to less investment, said Giorgetti, who described the investor as "embittered" in all respects. The limitation on accelerated depreciation  – a tax deduction for investing in rental properties, which had benefited investors in the past -  should be reversed, he added, as the ideas dated back to before the crisis, and no longer addressed the current situation. He also expressed concerns over the planned reform of the rent law.

The entrepreneur said he welcomed the fact that Minister of Housing Henri Kox was ready to introduce support measures for registration, but worried it was not enough to reinvigorate the market.

Giorgetti also commented on proposals for the government to purchase private projects and build up more affordable housing, pointing out that the State possesses enough land to build on 2 million square metres. Although there is a lack of labour and workforce within the sector, Giorgetti expressed optimism that the market would handle future demands. He also appeared positive regarding his company's outlook on the future, explaining the company had diversified by working on a number of public projects, and would not introduce lay-offs if they could help it.

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