The average price of apartments in Luxembourg increased by 63% between 2012 and 2020 while the average household net income increased by 10% in the same period, meaning that apartment prices increased six-fold compared to household net income.
The average price for a new apartment in 2012 was €390,279 for an average floor area of 81 m2, which jumped to €638,076 in 2020 for an average 83 m2 apartment, data from the national statistics agency STATEC showed.
The average prices are for buyers who will occupy the dwelling on their own and include 3% VAT.
With regard to the average price by floor area, this ranged from €3,221 to €6,853 per m2 in 2012; in 2020, average prices varied between €4,406 and €12,830, according to data from Luxembourg's Ministry of Housing.
At least ten municipalities reported transactions for new apartments with prices exceeding €10,000 per m2 of floor area in 2020.
In comparison, data compiled from the European statistics agency Eurostat showed that net household income increased by only 9.9% on average.
The household net income for a single person without children earning equal to the national average in 2012 was €37,354.34 which increased to €41,238.55 in 2020 - a 10.4% increase.
Similarly, couples without children who both earned equal to the national average had a net income of €76,533.87 in 2012, increased to €84,354.96 in 2020 equating to 10.2% increase.
For families with two children, a single-earner household had a net income of €50,419.64 in 2012. This increased by 9.7% to €55,292.83 in 2020. If both parents earned equal to the national average, the household net income increased by 9.4% from €84,055.59 in 2012 to €91,968.72 in 2020.
There were eight automatic wage indexations between January 2012 and December 2020, which partly offset the inflationary pressure on household consumption price increases, amounting to a 19% increase in social minimum wages during this period.
