Authored by the expert who managed and guided the team behind the Luxembourg Property Pack
Everything you need to know before buying real estate is included in our Luxembourg Property Pack
What do the latest numbers reveal about Luxembourg’s real estate market? Are property prices on the rise, or are they stabilizing? Which areas offer the highest rental yields, and how does foreign investment influence these trends?
We’re constantly asked these questions because we’re deeply involved in this market. Through our work with developers, real estate agents, and clients who invest in Luxembourg, we’ve gained firsthand insights into these trends. Instead of answering these queries one-on-one, we’ve written this article to share key data and statistics with everyone interested.
Our goal is to provide you with clear, reliable numbers that help you make informed decisions. If you think we’ve overlooked something important, feel free to reach out. Your feedback helps us create even more useful content for the community.
1) Luxembourg’s residential sector is projected to grow by 3.13% annually through 2029
The residential sector in Luxembourg is set to grow by 3.13% annually through 2029.
Luxembourg's high standard of living and robust economy continue to draw a diverse crowd, fueling demand for homes. This demand is a major force behind the sector's expansion. People are not just looking for any home; they want modern, luxurious spaces with top-notch amenities.
There's a clear shift towards sustainable and energy-efficient properties, as more buyers prioritize environmental consciousness. This trend is reshaping the market, with developers focusing on green building practices to meet these new expectations.
Key market indicators like GDP and household wealth are crucial in understanding this growth. These metrics help paint a picture of why the residential market is thriving, showing a strong economic backdrop that supports property investment.
Luxembourg's housing market is also influenced by the price level index and consumer spending on housing. These factors highlight the financial capacity and willingness of residents to invest in quality living spaces.
As these elements come together, they create a dynamic environment for residential growth, making Luxembourg an attractive option for property buyers.
Source: Statista
2) Residential property prices in Luxembourg City have risen by about 15% since 2023
In 2023, the average price of residential properties in Luxembourg City increased by approximately 15%.
While there were some ups and downs in property prices, certain areas like Belair stood out with higher prices. For example, in November 2024, Belair's average price per square meter was €14,327, showing that some neighborhoods maintained their value even when others dipped.
Energy efficiency played a big role in pricing. In late 2023, energy class A homes averaged €9,547/m², while less efficient class G homes were at €7,156/m². This trend likely continued into 2024, influencing the market dynamics.
Experts were optimistic about 2024, expecting a rebound in the market. Government measures aimed at boosting the construction sector were seen as a positive sign, suggesting a potential stabilization and gradual increase in property prices.
Despite a 1.4% drop in the third quarter of 2024, the average price per square meter was still €12,462. This indicates that while there were fluctuations, the overall trend was upward.
Overall, the market showed resilience, with a slowing in the downward trend of advertised selling prices. This was a promising sign for potential buyers looking at Luxembourg City as a stable investment.
Sources: Immotop, CBRE, Spuerkeess, Delano, AtHome
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Luxembourg. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
3) Residential property prices fell by 8.3% year-over-year in Q2 2024
The overall residential property prices in Luxembourg have decreased by 8.3% year-over-year in Q2 2024.
In the past year, the average price per square meter has seen a noticeable drop, going from 8,928 €/m² in Q2 2023 to 8,670 €/m² in Q2 2024. This 2.9% decrease is part of a larger trend where property values have been steadily declining over several quarters.
Looking at the more recent changes, from Q1 2024 to Q2 2024, there was a further 1.7% decrease in prices, moving from 8,818 €/m² to 8,670 €/m². This shows a consistent downward pressure on property prices in a relatively short time frame.
These shifts in the market are significant for potential buyers, as they reflect a more favorable environment for purchasing property in Luxembourg. The ongoing decline suggests that the market is adjusting, possibly due to economic factors or changes in demand.
For those considering buying property in the country, this trend might mean more opportunities to find affordable options. It's a good time to explore the market and see what deals might be available.
Understanding these statistics can help you make informed decisions, especially if you're looking to invest in Luxembourg's real estate. The current market conditions could offer unique advantages for savvy buyers.
Sources: Immotop.lu
4) Residential building permits in Luxembourg have increased by about 10% since 2023
The number of residential building permits issued in Luxembourg has increased by approximately 10% since 2023.
In March 2023, there were 57 residential building permits issued, a jump from 37 in February, according to CEIC and Moody's Analytics. This surge suggests a growing interest in residential construction, likely fueled by favorable market conditions.
Luxembourg's real estate market is stabilizing, with apartment sale prices dropping in the third quarter of 2024, and house prices also seeing a decline. This price adjustment, averaging around -9.3% in early 2024, might be encouraging developers to build more, anticipating future demand.
Lower interest rates have made financing more accessible, playing a significant role in this trend. With cheaper loans, there's been a resurgence in the property market, prompting more residential construction and, consequently, more building permits.
These changes are not just numbers; they reflect a shift in the market dynamics. As developers see potential in the future demand, they are more inclined to invest in new projects, evidenced by the increased number of building permits.
For anyone considering buying property in Luxembourg, these trends indicate a market in transition, with opportunities arising from the current economic climate. The decline in interest rates and price adjustments are key factors to watch.
Sources: CEIC Data, Moody's Analytics, RTL Today
5) Apartments under construction saw the smallest price drop, down 4.3% in Q2 2024
In the second quarter of 2024, the Luxembourg real estate market saw a general decline in property prices, but apartments under construction experienced the smallest price decrease, down 4.3%.
This smaller dip highlights the relative stability in the new construction segment, even as the overall market faced a downturn. While the national average price decline was -3.8%, flats and houses saw more significant drops of -3.3% and -4.9%, respectively.
Interest rate cuts and economic conditions played a role in shaping market trends. These factors, along with government measures, might have contributed to the resilience of new constructions.
Looking ahead, the market was anticipated to recover in 2025, which could have supported the stability of apartments under construction.
Sources: atHome Blog
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6) Luxembourg’s real estate market is expected to see significant growth in 2025 after a gradual recovery in 2024
In 2024, Luxembourg's real estate market began to stabilize, paving the way for growth in 2025.
After a period of declining prices, platforms like atHome and athome.lu noted that house and apartment prices were expected to stabilize or slightly increase in 2025. This shift is a promising sign for potential buyers.
Market analysis from Immotop.lu and Spuerkeess revealed that 2023 saw the lowest number of real estate transactions on record. However, they foresee a rebalancing in 2024, which could boost consumer interest and affordability, leading to more transactions.
Economic factors are also at play, with favorable fiscal measures and lower interest rates supporting demand. These conditions are creating a positive environment for the real estate market in 2025.
As the market stabilizes, potential buyers might find more opportunities and better affordability in the coming years. This could be an ideal time to consider investing in Luxembourg's real estate.
Sources: RTL, Spuerkeess, atHome
7) By 2025, the average price per square meter for homes in Esch-sur-Alzette is about €7,000
In 2025, the average price per square meter for residential properties in Esch-sur-Alzette is around €7,000.
Back in October 2024, prices were slightly higher, with the average at €7,248 per square meter. This was a small dip from earlier months, especially noticeable in the Al-Esch zone. There, prices fell from €7,299 in October 2023 to €6,725 in October 2024, a drop of 7.86%.
Despite these ups and downs, Luxembourg's economy is still growing, which keeps the real estate market buzzing. But there's a catch: new homes are in short supply, which can keep prices from falling too much. High interest rates have also played a role in cooling demand, but if these rates level off or drop, we might see a market boost.
For potential buyers, this means keeping an eye on interest rates and housing supply is crucial. If rates go down, it could be a good time to jump in. Meanwhile, the limited number of new homes means competition for existing properties might stay fierce.
So, if you're considering buying in Esch-sur-Alzette, understanding these dynamics can help you make a smart decision. The market is influenced by both economic growth and the availability of new homes, which are key factors to watch.
Sources: Immotop, Nextimmo, Immotop Al-Esch
8) By 2025, nearly 20% of homes in Luxembourg will have smart home technology
In 2025, nearly 20% of residential properties in Luxembourg are equipped with smart home technology.
This shift is part of a larger trend across Europe, where the smart home market has been growing rapidly. Government initiatives for green energy and rising disposable incomes are key drivers of this expansion. People are increasingly interested in making their homes more efficient and tech-savvy.
Luxembourg's home entertainment sector is also on the rise, with a focus on cutting-edge products like smart TVs and streaming devices. This market is expected to grow by 6.33% from 2024 to 2029, showing that consumers are eager to integrate more technology into their daily lives. This enthusiasm likely spills over into the adoption of smart home technology.
While we don't have specific numbers for Luxembourg's smart home adoption in 2025, the European trend is clear. The market is expanding due to energy efficiency concerns and government regulations, making it likely that Luxembourg will follow this path.
As more people in Luxembourg embrace technology, the demand for smart home features is expected to grow. This aligns with the broader European movement towards smarter, more connected living spaces.
Sources: MarketsandMarkets, UnivDatos, Statista Market Forecast
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Luxembourg versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
9) By 2025, 95% of homes in Luxembourg have high-speed internet access
By 2025, 95% of homes in Luxembourg will have high-speed internet, thanks to a focused broadband strategy.
This plan, running from 2021 to 2025, aims to boost digital access and connectivity throughout the country. The goal is to ensure that every household connects to a Very High Capacity Network (VHCN), which offers speeds of at least 1 Gbps download and 200 Mbps upload.
By 2025, the strategy targets 100% adoption of basic ultra-high-speed internet with at least 100 Mbps download and 20 Mbps upload for all residential users. As of 2023 and 2024, over 95% of Luxembourg's households already enjoy these high-speed services, mainly through fiber-optic, CATV, 5G fixed wireless access (FWA), and satellite.
Luxembourg's commitment to digital infrastructure is evident in its rapid deployment of these technologies. The country is ensuring that nearly every home is equipped with cutting-edge internet capabilities, making it a leader in digital connectivity.
For potential property buyers, this means reliable and fast internet access is almost guaranteed, enhancing the appeal of living in Luxembourg. The infrastructure supports not just everyday browsing but also remote work, streaming, and smart home technologies.
Sources: Dig Watch, Digital Strategy, Gouvernement.lu
10) In November 2024, Luxembourg’s average residential property price was €8,272 per square meter, down 4.69% from December 2023
The average price for residential properties in Luxembourg was €8,272 per square meter in November 2024, marking a 4.69% decrease from December 2023.
In Luxembourg, property prices vary significantly by region. For instance, in November 2024, the Centre region had an average price of €10,586 per square meter, while the Nord region was much lower at €5,909 per square meter. This stark contrast shows how location can greatly influence property values.
Looking at historical trends, the Luxembourg real estate market has been on a downward slope in recent years. During the second quarter of 2024, there was a continued drop in sales prices, although the decline was less severe than in previous quarters. This pattern affected both existing and new properties.
Interestingly, flats have managed to hold their value better than houses during this period. This resilience in flat prices suggests a shift in buyer preferences or perhaps a stronger demand for smaller living spaces.
These trends are crucial for potential buyers to consider, as they reflect the dynamic nature of the market. Understanding these regional and historical price variations can help in making informed decisions when purchasing property in Luxembourg.
Sources: IMMOTOP.LU, atHome Blog
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility. Finally, please note that we are not affiliated to any of the sources provided. Our analysis remains then 100% impartial.