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Thinking about buying a 3-bedroom apartment in Kirchberg? It’s a great area, but you're probably wondering: is now the right time to buy, or should you wait for prices to drop?
And what about long-term investment—should you look into other districts like Limpertsberg or Belair where property values might appreciate more over time?
In this article, we’ll answer these questions. We know this market quite well - and we have put all our knowledge in the Luxembourg Property Pack.
Will property prices increase in Luxembourg in 2025?
Yes, property prices in Luxembourg are expected to rise in 2025, driven by a combination of high demand and a limited supply of housing.
Backed by our fresh, in-depth market analysis, we’re confident that Luxembourg remains one of the most attractive markets in Europe for both domestic and international investors.
While there are some economic challenges like inflation and rising interest rates, the main drivers behind Luxembourg’s price growth remain strong.
Demand, especially in the central areas, continues to outpace supply, making significant price drops unlikely. Additionally, Luxembourg's status as a financial hub and its high quality of life keep attracting buyers from around the world.
Signals pointing to a property price increase in Luxembourg
Here are some factors suggesting prices could increase:
The ongoing shortage of housing supply, particularly in urban areas, is expected to persist into 2025. With demand remaining robust, this lack of supply will likely continue to drive up property prices.
Luxembourg's strong economic performance and low unemployment rates are expected to continue, providing residents with the financial stability needed to invest in property, thereby supporting price increases.
The government’s continued investment in infrastructure projects, such as improved public transportation and road networks, is likely to enhance property values, especially in areas benefiting from better connectivity.
Luxembourg's favorable tax environment for businesses and individuals is expected to attract more expatriates and international companies, increasing demand for both residential and commercial properties.
The trend of remote working is expected to persist, with more professionals seeking larger living spaces outside of city centers, thereby increasing demand and prices in suburban and rural areas.
Luxembourg's reputation as a safe and stable country with a high quality of life continues to attract international buyers, further boosting demand for property.
Signals pointing to a property price decrease in Luxembourg
Here are some factors suggesting prices could fall:
Rising interest rates could make mortgages more expensive, potentially reducing the purchasing power of some buyers and cooling demand.
Inflationary pressures and increasing living costs may strain household budgets, leading to a slowdown in property purchases, particularly among first-time buyers.
Potential regulatory changes aimed at cooling the housing market, such as stricter lending criteria or increased property taxes, could dampen demand and slow price growth.
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If property prices go up in Luxembourg, how much would they increase by?
If real estate prices in Luxembourg were to rise in 2025, the increase would likely be around 3% to 7% of their 2024 values.
Typically, real estate in dynamic markets like Luxembourg appreciates by approximately 3% to 7% annually over the long term. However, fluctuations can occur depending on factors such as region, season, and property type.
It means that, if you spot a charming 2-bedroom apartment in Kirchberg for 850,000 euros today, don't be surprised if it's priced between 875,500 and 909,500 euros this time next year.
To give you a better understanding, here is a table that shows 7 types of Luxembourg real estate properties, their estimated prices in 2024, and projections for 2025 based on potential price increases of 3%, 5%, and 7%.
| Type of Property | Average Price in 2024 (€) | Price in 2025 (3% increase) | Price in 2025 (5% increase) | Price in 2025 (7% increase) |
|---|---|---|---|---|
| Modern Apartment (60 sqm / 646 sqft) | €900,000 | €927,000 | €945,000 | €963,000 |
| Luxury Apartment (75 sqm / 807 sqft) | €1,200,000 | €1,236,000 | €1,260,000 | €1,284,000 |
| Penthouse (100 sqm / 1,076 sqft) | €2,500,000 | €2,575,000 | €2,625,000 | €2,675,000 |
| Studio (30 sqm / 323 sqft) | €450,000 | €463,500 | €472,500 | €481,500 |
| Loft (80 sqm / 861 sqft) | €1,600,000 | €1,648,000 | €1,680,000 | €1,712,000 |
| Townhouse (150 sqm / 1,615 sqft) | €3,500,000 | €3,605,000 | €3,675,000 | €3,745,000 |
| Investment Property (50 sqm / 538 sqft) | €750,000 | €772,500 | €787,500 | €802,500 |
Everything you need to know is included in our Property Pack for Luxembourg
If real estate prices go up in Luxembourg, which areas are likely to see the biggest increases?
Today, people who want to move to Luxembourg seek a blend of historical charm and modern amenities, which Grund offers. Hence, we could see a price increase there in 2025.
Additionally, there's been a trend towards more dynamic and youthful neighborhoods, and Clausen has really gained popularity.
We like it when information is clear and easy to digest. So, here’s a table that highlights the areas where prices might rise the most, along with the reasons behind those expected increases. It’s very high-level. If you want more details on a specific area, please check our real estate pack tailored to the Luxembourg market.
| Neighborhood | Level of Increase | Why |
|---|---|---|
| Grund | High | Its picturesque setting and historical significance, combined with limited housing availability, drive demand among affluent buyers. |
| Kirchberg | High | The presence of EU institutions and ongoing development of modern residential and commercial spaces make it highly desirable. |
| Clausen | Medium-High | Its vibrant nightlife and cultural scene, along with new residential projects, are attracting young professionals. |
| Belair | Medium | Known for its family-friendly environment and proximity to the city center, it remains a popular choice for families. |
| Gare | Medium-High | Ongoing urban renewal projects and improved transport links are enhancing its appeal to both residents and investors. |
| Limpertsberg | Medium | Its proximity to educational institutions and the city center makes it a sought-after area for students and professionals alike. |
| Cessange | Medium-High | New residential developments and green spaces are increasing its attractiveness for families and young couples. |
| Hollerich | High | Large-scale urban regeneration projects and improved public transport access are expected to make this area more desirable. |
| Esch-sur-Alzette | Medium-High | Its proximity to Luxembourg City and new cultural and commercial developments make it increasingly attractive to professionals. |
| Bonnevoie | Medium | Gentrification and cultural regeneration projects are attracting new residents, leading to rising prices as the area becomes more fashionable. |
| Weimerskirch | High | As new luxury developments are launched, demand for premium housing among wealthy buyers is expected to further increase property values. |
| Pfaffenthal | High | Upcoming restoration projects and high-profile cultural initiatives are driving a renewed focus on this central, historic location. |
If I'm looking to invest in real estate, what types of properties should I focus on for the best value appreciation in Luxembourg?
In 2025, Luxembourg real estate trends focus on tech-smart, energy-efficient apartments, larger suburban homes for families, properties with outdoor spaces, and eco-friendly buildings—all driving higher demand and prices. Here is a summary.
- Tech-Equipped and Energy-Efficient Apartments:
Driven by remote work and sustainability trends, these homes offer smart technology features and energy-saving systems. They cater to young professionals and tech workers, making them a hot commodity in 2025.
- Family-Sized Apartments in Suburban Areas:
With a growing demand for larger living spaces, especially among families, suburban areas near Luxembourg City are seeing increased interest. Proximity to green spaces and schools is a major factor driving value.
- Properties with Outdoor Spaces:
Post-pandemic, outdoor spaces like terraces, balconies, or gardens have become highly desirable. In dense areas like Luxembourg City, these features offer a much-needed escape and are likely to drive up property values.
- Eco-Friendly Buildings with Low Carbon Footprints:
Luxembourg's commitment to sustainability is boosting demand for eco-certified buildings. Buyers are increasingly valuing properties that align with the country's green goals, leading to price appreciation in this category.
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