Two further Luxembourgish developers have sounded the alarm about the construction sector, warning that "political decision-makers are not aware" of the urgency of the situation.

Rising interest rates have changed the face of the Luxembourg property market. Whereas a little over twelve months ago, people were rushing to buy as soon as a property was put up for sale, the housing market is now "in a complete gridlock", says developer Marc Giorgetti.

On Friday, two figures from Luxembourg's construction sector addressed this subject in a new episode of 'La Bulle Immo' over on RTL 5minutes. Christoff Delli Zotti and Paul Nathan both agreed with Giorgetti's assessment of the situation. The two entrepreneurs even went as far as to say that the "housing market is currently in freefall" and claim that some companies "no longer have enough work".

Christoff Delli Zotti, vice-président de la fédération des entrepreneurs et membre du comité de direction de l'entreprise de construction Delli Zotti / © Dellizotti
Paul Nathan, directeur technique de l'entreprise Poeckes et vice-président de la Chambre des métiers / © Poeckes
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According to Delli Zotti, a member of the executive committee of the Dellizotti company and vice-president of the Federation of Entrepreneurs, panic is starting to settle in. "What's happening is very worrying," he said and underlined that 20,000 jobs depend on the creation of housing in the Grand Duchy.

Read/listen: Lisa Burke Show - what's happening in the housing market?

"We only build on demand ... without investors, we cannot create anything," explains Nathan, technical director of the Poeckes company and vice-president of the Chamber of Trades. He also pointed out that in Luxembourg, "three quarters of construction companies are micro-firms" and that they are "most vulnerable".

They are not the first to sound the alarm. Roland Kuhn, another real-estate developer, has already alerted the Minister for Housing by asking for a twelve-month-long aid for the construction sector. Both Delli Zotti and Nathan expressed support for this call and predicted "dramatic consequences" if the government fails to react.

The two individuals do not exclude any scenario, whether it be a series of bankruptcies, a wave of unemployment, or budgetary problems. "There will be human tragedies", said the managing director of the Dellizotti company, who further believes that "political decision-makers are not aware" of the urgency of the situation.

Delli Zotti also called for "emergency measures to relaunch activities" in the sector, such as doubling the 3% VAT ceiling, returning to an accelerated depreciation rate of 6%, or even an exemption from construction registration fees. However, just like Kuhn, Delli Zotti insists on the temporary nature of this aid.

Nathan for his part argued that if nothing is done, the crisis "will not stop at the construction sector" and that "this is only the beginning". He is convinced that the consequences of inaction "will come at a high cost for Luxembourg" and that it will take years for the country to recover.