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After recording a €5 million loss in 2023, the SNHBM has returned to profitability in 2024 with a modest €48,000 gain, while simultaneously ramping up its construction activity.
The National Society for Affordable Housing (SNHBM), one of Luxembourg's public housing developers, reported a net profit of approximately €48,000 for 2024 – a significant turnaround after recording a €5 million loss in 2023. The agency also saw notable growth in construction activity, with 300 new residential units launched in 2024, marking a 30% increase from the previous year.
Last year, the SNHBM delivered 250 homes – a 56% increase compared to 2023. But the agency has its sights set even higher, with a medium-term goal of delivering 400 new homes each year. Reaching that target, however, will depend on acquiring more land, as SNHBM Director Guy Entringer pointed out.
Currently, the agency's land reserves are allocated for 2,796 units. "At a rate of 400 units per year, our reserves will last until 2031," Entringer said. Given the lengthy timelines for housing projects, he stressed the urgency of identifying new sites in collaboration with the government. "A project takes several years to implement, so we must act now," he added.
In 2023, the SNHBM faced sluggish sales despite offering affordable housing and relatively high income eligibility thresholds. For example, a couple with two children can qualify with a net monthly income exceeding €11,000, while childless households must earn over €7,000.
Sales have since improved, with 60 units sold in 2024 and 68 already sold by May of this year – a trend the agency describes as positive. However, officials note that buyers still prefer completed properties over off-plan purchases.
Entringer highlighted bridging loans as a key obstacle for potential buyers. He illustrated the issue with a specific case: A household renting a home for €2,500 monthly faced €2,200 in monthly interest payments if they signed a purchase agreement with SNHBM immediately. This would have brought their total monthly housing costs to €4,700 for several months – a financially untenable situation that led the buyers to delay their purchase until they could transition directly from rent to mortgage payments.
To address unsold inventory, the SNHBM plans to implement a six-month deadline after which completed but unclaimed homes will be transferred to its rental pool. This move comes as waiting lists for affordable rentals remain strained, with over 5,000 applicants registered at the end of 2024.
The upcoming national affordable housing register is expected to provide clearer data on actual demand, as current lists may include duplicates. Entringer pointed out that there are “several thousand” overlapping entries between SNHBM’s waiting list and that of the Housing Fund, Luxembourg’s other main public housing provider.
The introduction of the unified register, Entringer said, will help distinguish unique applicants and provide more accurate statistics for housing planning.
