STATEC: Construction Prices Drop in Luxembourg

Luxembourg's national statistics portal, STATEC, has reported that construction prices are dropping in the Grand Duchy.

According to STATEC, residential construction prices have shown the lowest half-year increase since October 2020. Between April 2023 and October 2023, the construction price index increased by only 1.2%, after an increase of 5.2% between October 2022 and April 2023.

Over one year, prices in residential construction increased by 6.4%. According to STATEC, the decrease in the costs of certain construction materials, offset however by the rise in labour costs and weaker demand in the construction sector, explains the stability and even downward pressure on construction prices.

After growing by 33.2% between October 2020 and April 2023, prices in structural work showed a certain stability over the last half-year (up 0.3% between April and October 2023). This sudden slowdown made structural work the trade with the lowest half-yearly and annual growth. Weaker demand in a competitive market put pressure on the prices of these services, despite rising salary costs, STATEC noted. At the same time, the prices of certain materials, such as formwork or steel, continue to fall.

Prices for roofing work have also been rising less quickly (up 1.7%) but were boosted by the increase in the cost of roofing work (up 2.8%). While the prices of frames are stable (down 0.1%), services related to flat roofs (up 3.0%) or even roof windows (up 2.2%) remain clearly on an upward trend.

Just like the structural work, the prices of building closure services, which include windows with solar protection devices, garage doors and facades, tended to stabilise (up 0.6% between October and April 2023). Over six months, project owners must pay 0.2% more for the exterior carpentry of residential construction, but the bill for façade work increased by an average of 1.1%.

At the level of technical installations, the increase in labour costs was passed on more systematically, making it the trade whose prices are the most dynamic (up 2.5% over one half-year). The prices of certain supplies, such as electrical installations (up 3.4%), have also continued to rise, while others were on a downward trend (sanitary appliances, water supply pipes, etc.).

For finishing, a trade heavily weighted in the construction price index and which encompasses a wide range of services, prices increased by 1.7% over one half-year. Apart from plastering (down 1.5%) all service groups contributed to the increase. Tiling work (up 4.4%) and marble work (up 7.8%) were the services whose prices have increased the most over the last half-year among all trades.