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Luxembourg housing prices soar by 13% in a year
Real estate

Luxembourg housing prices soar by 13% in a year

by YL 2 min. 07.10.2020 From our online archive
Covid-19 pandemic leaves housing crisis in Luxembourg firmly in place

The economic crisis triggered by the Covid-19 pandemic has not stopped the drastic growth of housing costs in Luxembourg - the highest in the European Union - despite stalling sales, the EU's statistics body said.

Housing costs increased by 13.3% in the second quarter compared to a year earlier, and by 4.4% from the first quarter, Eurostat said, roughly in line with figures from the Luxembourg agency Statec.

Only the number of sales is declining, with a decrease of 22.2% compared to the previous quarter. In the first quarter, they decreased by 7.1% compared to the previous quarter.

A buyer in Luxembourg now pays an average of €8,354 per square metre for a new flat, and €6,826 for an existing one.  

In the first quarter of the 2020, house prices had already risen 14% year-on-year. Around 18,000 of the poorest households in Luxembourg spend at least 40% or more of their income on housing.

Luxembourg's government has increasingly been under pressure to intervene more strongly  in the market, to better protect renters and to create more affordable housing.

During the second quarter of 2020, house prices, as measured by Eurostat's house price index, increased by 5% in the euro area and by 5.2% in the EU compared with the same quarter of 2019.

Compared to the first quarter of this year, house prices in the second quarter of 2020 increased by 1.7% in the euro area and by 1.5% in the EU.

Among the EU nations for which data are available, the highest annual increases in housing prices in the second quarter of 2020 were observed in Luxembourg (+13.3%), Poland (+10.9%) and Slovakia (+9.7%).

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