Throughout 2023, the volume of authorised floor space and dwellings continued to dwindle across Luxembourg. Nationally, there was a notable 5% decrease in the number of authorised dwellings compared to the preceding year, which itself marked a downturn from previous years. This downward trend reflects a substantial 20% decline over the past five years.
According to STATEC’s latest report released on Tuesday, the data on building permits underscore a persistent contraction in construction sector activity.
Since 2019, the authorised area for construction has plummeted from nearly 2 million square metres to 1.1 million square metres in 2023, representing a staggering 44% decline, with a particularly sharp deterioration noted since the onset of the conflict in Ukraine in 2022.
Both residential and non-residential construction are affected by the economic climate. In 2019, one million square metres were authorised for residential construction. This compares with just 609,000 m2 in 2023. This represents a fall of 41%. With just over 4,450 homes authorised, the level is similar to 2015. Except that at that time, Luxembourg had a population of 560,000, compared with more than 660,000 on 1 January 2023.
In the non-residential sector, authorised applications have similarly dwindled, with the area falling from approximately 920,000 square metres five years ago to 510,000 square metres in 2023, marking a 44% decrease.
In 2023, single-family homes accounted for one in four authorised dwellings, a ratio that has remained relatively stable over the past five years.
Just over 1,000 single-family homes were approved for construction in 2023, reflecting a stark 28% decline compared to 2019, equating to 400 fewer single-family homes, as highlighted by STATEC.
Meanwhile, buildings with two or more dwellings saw almost 3,200 authorisations in 2023, representing a comparatively modest decline of 18%. However, this still translates to nearly 700 fewer homes than in 2019.
Despite overall declines in housing construction permits, a closer examination reveals varying trends across different geographical areas in Luxembourg. While Luxembourg City and the canton of Esch-sur-Alzette have shown positive developments compared to 2022, the broader picture remains one of decline.
Luxembourg City witnessed an 18% increase (+140 homes) in authorised dwellings, while Esch-sur-Alzette experienced a notable 32% uptick (+280 homes). However, when comparing figures to 2019, both areas still exhibit negative trends, with the capital experiencing a 12% decrease and the canton of Esch-sur-Alzette facing a 17% decline.
The country’s other cantons are witnessing a downward trajectory compared to 2022, with the western cantons bearing the brunt of the decline, plummeting by as much as 32%.
