The Luxembourg housing market saw signs of stabilisation in the final quarter of 2024, according to atHome, with prices steadying after a period of fluctuation.
The platform’s analysis indicated that the government's extended tax measures and a reduction in interest rates are expected to contribute to a positive outlook for the year ahead.
Gerry Grbic, from the banking association ABBL, explained the renewed interest in mortgages during an RTL interview just before Christmas. "There are three factors at play: the reduction in prices, the decrease in rates, and the purchasing power, which has increased due to the index-linked wage adjustments and various measures."
AtHome, which bases its analysis on listed prices, predicts that the recovery in the housing market will continue into 2025. This could result in the prices of existing homes, which had previously fallen, either stabilising or rising again. For new apartments, where developers have largely kept prices steady, no significant price changes are anticipated in the short term. Off-plan apartments were last priced at €9,696 per square metre.
Price developments in late 2024
In the last three months of 2024, the national average saw a decline in the prices of older houses, with a drop of 2.6% over the year. Existing apartments saw a smaller decrease of 0.5%, while new apartments experienced a modest fall of 0.3%.
© Screenshot atHome
Price trends varied by region, with slight increases in the North and Centre and decreases in the West and East.
Rental market trends
In the rental sector, atHome observed that rents, which had risen sharply during the construction crisis, are no longer expected to climb further. Between October and December, rents even decreased for the first time in months. Rents for houses fell by 3.7%, while apartment rents dropped by 1.9%.
The Housing Observatory, which releases data with a delay of one trimester, corroborated atHome’s findings. Its analysis of the third trimester of 2024 suggests that the trends observed in the housing market are likely to continue, pointing towards a continued stabilisation of prices in the months ahead.
