The Chamber of Deputies has extended key housing investment incentives until the end of June, amid political division and growing calls for reform and transparency in the property market.
The state financial and tax measures for investment in housing have been extended by the Chamber until the end of June. Retroactively effective from 1 January, the measures, which include a higher threshold for notarial deeds related to property transactions – commonly known as the 'Cheap Act' or 'Bëllegen Akt' in Luxembourgish – also include halved registration costs, a quarter rate on capital gains, and increased accelerated depreciation.
The higher threshold was approved by all 60 MPs through a separate vote. However, the other measures received support only from the governing parties, the Alternative Democratic Reform Party (ADR), and the Pirate Party. Pirate leader Sven Clement emphasised that this would be their last favourable vote on this matter.
Finance Minister Gilles Roth explained during RTL Radio's 'Background' emission on Saturday and again in Parliament on Wednesday his recommendation that the measures should not be extended beyond the end of June, with the exception of the increased registration fee, which has been raised from €30,000 to €40,000. Democratic Party (DP) MP Patrick Goldschmidt stated that a review will take place in July to assess the next steps but expressed confidence that 30 June would be the right date to conclude the main measures of the housing package.
Minister Roth also issued a warning to "speculators", urging them to act responsibly before the deadline. This stance was praised by Greens MP and former Housing Minister Sam Tanson.
Criticism from the Greens and the Left
Finance Minister Gilles Roth defended the 'Housing Package' by emphasising that in order to strengthen housing availability during the crisis, it has been essential to support private investors. However, Luxembourg Socialist Workers' Party (LSAP) MP Franz Fayot continued to criticise the measures, calling them "gifts to a certain group of people" and labelling them as anti-social and anti-competitive.
The Greens and the Left (Déi Lénk) also opposed the extension of the package. Tanson regretted that investors were benefiting without having to give anything back. She further questioned the absence of reforms on property taxes and the new mobilisation tax.
In response, Roth assured that the government was committed to implementing these reforms, with the relevant departments – including the land registry office – working at full capacity and receiving support from the Ministry of Finance.
Unified call for improved transparency
Despite some opinion differences, Roth and Fayot agreed that the Chamber should be provided with more transparent data regarding the composition of property prices. This call for more transparency was echoed by Christian Social People's Party (CSV) MP Michel Wolter, who pointed out that it was not only necessary to gather data within the country but also to make comparisons with neighbouring regions.
Wolter also expressed frustration that his own municipality of Käerjeng, the tenth-largest in the country, could no longer afford to purchase land due to increasing property prices, especially with more people moving abroad.
Roth agreed and promised to ensure greater transparency, suggesting that the Chamber send a letter to the Prime Minister Luc Frieden to urge the mobilisation of all concerned authorities.
