Missing keys to the kingdom: Homelessness in a land of millionaires

After comparatively holding out for quite some time, the economic squeeze experienced for so long elsewhere is now a reality for many in Luxembourg.

Rising inflation, a deepening housing crisis, global trade tensions, the ongoing and ever-changing movement of refugees to Europe, the lasting effects of COVID, all contribute to the mounting cost-of-living pressures being felt. For a growing community, the Grand Duchy is no longer – or never has been – that reliable sanctuary of assured financial security.

An increasing number of people in Luxembourg find themselves without permanent housing, witnessed by the growing demand for help provided both by the state and non-profits, and how these services are being stretched to full capacity. Take the Wanteraktioun, as an example, a campaign providing vital support for the homeless community during the winter months. Since 2021/22, their enrollment figures have nearly doubled.

Elsewhere, the Caritas embezzlement scandal has done little to help attitudes towards the homeless community nor the commitment needed to remedy an issue that many have views on but fail to back-up with proactive responses and resolutions. With a series of high-profile charges continuing to emerge from the investigation into how €61 million was ‘misplaced’, public trust is wavering in NGOs and charities linked to the homelessness crisis. 

This does not help a community that is already often – and expressly – ignored, misunderstood, and immediately conflated with crime.

Luxembourg's housing crisis

The availability and affordability of housing in Luxembourg continues to push prospective buyers and renters out of the market.

This has frustrated those actively searching for accommodation, and has also caught the ire of the European Commission, with their 2024 country report for Luxembourg heavily criticising the government for the current state of the market and persistent inactivity in helping supply meet demand.

As of 2023, Luxembourgish residents pay 27.5% of their income on housing – the European average is 19.7%. When this is coupled with a ‘wait-and-see’ attitude in the new-build market, with developers and sellers preferring to hold out, as opposed to dropping asking prices, it comes as little surprise that sales of new apartments have hit their lowest since 2007. Case in point, 2023 to 2024 saw a 47.7% drop in new apartment acquisitions.

As it stands, purchasing power of prospective buyers and renters is not forecast to bounce back anytime soon. Renting is not a viable option for many, let alone the idea of owning a property.

If we apply these same conditions to those who are already at the margins of society, it paints an even more dire picture.

When asked about the main barriers to finding permanent housing that the homeless community face in Luxembourg, and factors in people ending up without a home, Nathalia Vassalo of the Luxembourgish Red Cross explained: "In the private [housing] market, there are not enough offers and prices are really high. So even with a low income it's almost impossible to pay bills…to pay for everything. That's the main barrier that we see with our homeless people…to find a home. [With current offered governmental support] it's difficult to find an apartment or a studio and to live with the remaining money, if there's anything left."

A crisis within a crisis: temporary housing and shelter

Unfortunately, the lack of housing supply does not just apply to the private market. Insufficient temporary social housing and shelters also compound the challenges that citizens under the poverty line and those without a home face.

Exact figures on the size of the homeless community in Luxembourg are hard to come by, but it is not looking positive. A 2024 census found over 200 individuals living on the streets of Luxembourg City. However, as is often the issue with this topic, underreporting skews the data from representing the true situation. For those on the frontline of the crisis, it is abundantly clear from the demand of their services that more supportive infrastructure is required.

‘At the Red Cross, we have in total 11 beds. Nine we can give for a week and two beds that are for emergencies’, says Vassalo. ‘It’s not enough to answer every request. [On average] we have around 30 people who come every Monday...so it's a really tough decision to make.’

Commitments have been made to help the current deficit in temporary housing and shelters provided. In line with the ambitious government objective of eradicating homelessness in Luxembourg by 2030, the Red Cross, in collaboration with another ASBL, is set to open a new night shelter with a further 20 beds by next year. This will also be accompanied with augmented medical facilities and personnel.

Protection and agency

An additional barrier to those seeking permanent housing also comes about through many homeless individuals being undocumented. Without a fixed address, the option of registering with the CNS and receiving the accompanying medical and social support (that so many take for granted) is not an option.

Diminished state protection is just one of the immediate effects. Individual agency also takes a big hit, as members of the homeless community are further alienated from participating in society and making changes that could result in permanent housing and employment.

Services, such as Medecins du Monde (MdM), attempt to fill gaps by providing healthcare and medical support to those outside of the system. However, the resources of their practitioners and representatives do not meet the current demand.

In Luxembourg City – the municipality with the largest homeless community in the country – MdM is only present three times a week. Although indispensable, the level of care that can be provided is nowhere near to the extent that the state healthcare system provides for others.

Here lies an issue in itself, without regular access to shelter and food, homeless individuals are more likely to experience health complications, both physical and psychological. Vassalo highlights how these conditions are not just exacerbated individually by homelessness but then also come with knock-on effects. Currently, services, although limited, are in place to help with individual risks, but when it comes to comorbidity, again there are sizeable deficits.

‘When you live on the street, after some time, you develop a psychological problem. You don't sleep right because you must always be awake and look over your shoulder. It's really hard for people,’ explains Vassalo.

‘We see a lot of people on the streets that have a drug problem, a drug addiction, and they have psychological problems. There are no structures that can take them in. We have structures for people with drug addictions and we have structures for people with psychological problems, but there is no structure for people who have both.’

Increased precarity

Going by statistics taken from 2022, 24% of the Luxembourgish population is at risk of poverty. Although poverty does not necessarily imply homelessness, this does well to demonstrate how socioeconomic hardship is not reserved for a select few in Luxembourg.

For individuals within that bracket, with the right mix of unfortunate circumstances, be it a messy divorce or the sudden loss of employment, the precarious risk of homelessness is an increasingly lived reality.

According to both the Ministry for Health and the Ministry for Finance, 12% of the population now resides below the ‘comfortable living threshold.’ When this data is broken down for certain demographics, 16% of children under 15 and 21% of 15 to 24-year-olds are under this threshold. 65% of single-parent households with three or more children and 51% of large families that include two adults meet the same criteria. Vassalo’s experience in the field speaks to this, with the Luxembourg Red Cross receiving requests for support from clients who come from all walks of life.

‘During the past years, we have people from everywhere. We have people that have been studying, people who have been working their whole life, people that are aged around 50 to 60 years old, people who come from the Southern European countries to look for jobs, people in social housing and their contract comes to an end, people that go through a divorce and lose everything, young people who have been to Dreiborn. We have a lot of different situations.’

Going forwards

Despite Luxembourg’s wealth and resources, the contrast between those with stable housing and those at risk has never been so stark.

Overall, governmental commitments to eradicate homelessness are geared in the right direction. Yet, like many issues in Luxembourg, despite the immense wealth that the state wields, the allocation of funding and resources often produces more questions than resolutions. With 2030 just under 5 years away, it remains unlikely that the target of 0% homelessness will be achieved.

A steady increase in street crime, and headline grabbing developments, such as the Caritas scandal and the 2024 begging ban, equally do not help with public attitudes towards the Luxembourgish homeless community. Crime that takes place on the streets of Luxembourg can often be confused with those who are in immediate need of support, running the risk to demonise and further ostracise.

In turn, solutions to Luxembourg's homelessness crisis are at threat of being overlooked in political debate and public discourse. Advocates warn that without sustained policy action, the scale of the problem will only continue to outpace the measures in place.