The Luxembourg real estate market is showing signs of transformation as we enter the first quarter of 2025. According to recent figures from atHome, a shift is taking place, with property sale prices beginning to rise moderately while rental prices undergo adjustments. This evolution follows the increase in transactions recorded in late 2024, signaling renewed activity in the market.
Sale Prices on the Rise for Houses and Apartments
After a long period of stability, older house prices have seen an increase of 3.5% compared to the previous quarter, reflecting a growing interest in this property segment. Meanwhile, older apartments have remained relatively stable, registering a slight rise of just 0.1%. New apartments, however, continue their upward trajectory, gaining 1.2% in value. With these shifts, the average price for an older house in Luxembourg now stands at €5,905 per m², while an older apartment reaches €7,790 per m².
Regional Variations in Property Prices
Regional disparities remain evident in property price trends. While older apartments have experienced slight price reductions in several areas, the eastern and northern regions have witnessed marginal increases. For new apartments, most regions are seeing a decline, except for the southern part of the country, where prices have remained relatively steady.
Rental Market: A Shift Toward Stabilization
After significant increases in 2024, the rental market is now experiencing downward adjustments. House rents have dropped for the second consecutive quarter, showing a 1.8% decrease compared to the last quarter of 2024. Apartment rents have also followed this trend, declining by 2.5%. These shifts suggest a gradual rebalancing after a prolonged period of rising rental costs.
Rental Price Trends by Region
Regional differences are also evident in the rental sector. The south and north have seen rental increases, with house rents rising by 4.6% in the south and 2.2% in the north. Apartment rents in these areas have climbed by 2% and 0.2%, respectively. Conversely, the center and western regions have recorded declines, with house rents dropping by 0.4% in the center and 9.9% in the west. Apartment rents in the center have also decreased by 1.6%.
A Market Bolstered by Favorable Economic Conditions
Several factors are supporting the market’s current momentum. Competitive interest rates and ongoing fiscal incentives are creating a favorable environment for buyers and investors alike. With these conditions in place, the real estate sector is poised for continued recovery throughout 2025.
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