Rent or buy when arriving in Luxembourg?

Investing in real estate in Luxembourg

Renting your home is often a natural choice when relocating to a new country.  However some specific elements should incentivise you to quickly become homeowner in Luxembourg, even if you only consider living several years in Luxembourg!
Do you know that more than 67% of residents in Luxembourg own their homes? Why such a percentage while real estate prices are high?

Taxes related to home ownership are favourable in Luxembourg

Transaction costs are limited

Registration fees are reduced to €100 (Bëllegen Akt) for any purchase up to €285,714 for a single person or €571,428 for a couple (7% of the price of the property above this threshold). Notary fees are moreover relatively limited on the transfer of ownership.

Property tax is practically non-existent

In comparison to other neighbouring countries, the property tax is very low in Luxembourg. Being owner does therefore not generate a significant tax pressure that might justify remaining a tenant.

The capital gain is tax-exempt

Similarly to most countries, the potential capital gain realised on the sale of the primary residence is non-taxable. Whatever the amount might be.

Mortgage interests are tax-deductible

A couple can annually deduct up to €10,000 of mortgage interests from its taxable revenues (+ €2,000 € per child). The deductibility of the mortgage interests results in an attractive net mortgage cost in relation to the rental cost.

On this basis, buying your home is a highly relevant question as soon as you will stay two years or more in Luxembourg! To easily calculate the number of years as from which it is better to buy than to rent your home based on your personal situation, you can use the tool myIPROPERTY available on website

Significant growth for Luxembourg property market and resilience to crises

A thriving economy in the centre of Europe

With a strong track record and a forecast of 4% annual growth in GDP (source World Bank), the Luxembourg economic development surpasses the performance of its neighbours.

A steady increase of the population

With a forecasted 2.2% annual growth (source World Bank), the increase in population results in a surge in housing demand.

An insufficient number of new constructions

The annual deficit in new homes is estimated to reach 3,000 units based on the number of delivery of new dwellings (source STATEC).

A real estate market that demonstrated its resilience in case of crises

Property prices have been marginally impacted by the 2008 financial crisis (1% decrease in 2009 followed by a steady increase of +/- 5% since 2010).

Do you know crowdinvesting? Invest in real estate in Luxembourg thanks to crowdfunding

Are you ready to invest? Here are the intermediaries who can help you find the property of your dreams.

Do not forget to read our advice to prepare your real estate visits.

The only point that should make you opt for renting before buying is the need to know better your new country in order to know in which city or district of Luxembourg you might move in!

Our little guide to the districts of the City of Luxembourg should already help you to choose.