Average House Price Increased by 10.9% in Q1-3 2020

The real estate advertisements site Immotop.lu has carried out an internal study on the evolution of the real estate market in the various districts of Luxembourg City in the face of COVID-19.

In the first quarter of 2020, the average price of a set of 2,028 listings of property for sale on Immotop.lu was €1,137,137. During the second quarter, 1,662 advertisements were registered with an average price of €1,227,530. This represents a decrease of 18% in the number of advertisements and an increase of 7.9% in the average price between the first two quarters of 2020. In the third quarter, 2,536 advertisements for sale were announced in the capital, with a average selling price of €1,261,365, or an increase of 25% in the number of advertisements and an increase of 10.9% in the average selling price between the first and third quarters of 2020.

The selling price per square metre in the capital was less significant than at the national level. In the first quarter, the average price per m2 was €10,141. In the second quarter, it remained stable and even fell slightly to €10,126 (down 0.1% between the first and second quarters). In the third quarter, the average price per m2 was €10,760, up 6.1% from the first quarter of 2020. This increase is mainly attributed to the increase in the price per m2 of houses for sale, which also impacted the number of announcements (up 205% between the first and third quarters). One of the main reasons for this increase over such a short timeframe correlates with the first lockdown in Luxembourg. Municipalities outside the capital or larger houses are among the new criteria for real estate searches that have emerged following the lockdown.

In the first quarter of 2020, the average price of a house in the capital (out of a set of 93 houses for sale on Immotop.lu) was €1,543,000. During the second quarter, 190 house advertisements were registered and the average price skyrocketed to €1,716,000. This represents an increase of 104% in the number of advertisements and of 11.2% in the average price between the first two quarters of 2020. In the third quarter, 284 advertisements of houses for sale were announced in the capital, with an average sale price of €1,724,000. This represents an increase of 205% in real estate listings, characteristic of the recovery in real estate activities, and an increase of 11.7% in the average selling price between the first and third quarters of 2020.

An accumulation of offers in retention in the second quarter of 2020 may explain this spectacular increase in the number of advertisements. Regarding the selling prices of houses per square metre in the capital, the average fluctuated during the first three quarters of 2020. In the first quarter, Immotop.lu noted an average price / m2 of €8,600. This fell to €8,270 / m2 in the second quarter (down 3.8%). In the third quarter, the average price per square metre reached €10,006, an increase of 16.4% between the first and third quarters.

Most of the increases in the average selling price of houses in the districts of Luxembourg City were not only linked to the increase in market prices. The surfaces of houses put up for sale were about as high as in the first quarter, which causes an artificial increase in prices in some neighbourhoods. 

In the first quarter of 2020, out of a set of 1,935 apartments (new and old) for sale on Immotop.lu, the average price of an apartment in the capital was €883,252. During the second quarter, 1,472 apartment advertisements were registered and the average price increased to €901,827. This represents a decrease of 23.9% in the number of advertisements and an increase of 2.1% in the average price between the first two quarters of 2020. In the third quarter, 2,252 advertisements of apartments for sale were announced in the capital, with an average selling price of €954,772. This represents an increase of 16% in terms of real estate advertisements and of 8.1% in terms of the average selling price between the first and third quarters. The average surface area advertised for apartments for sale increased slightly, from 80.1 m2 on average in the first quarter to 86 m2 on average in the third quarter of 2020, i.e. an increase of 5.7% in terms of announced surfaces.

Regarding the selling prices of apartments per square metre in the capital, the average increased slightly during the first three quarters of 2020. In the first quarter, there was an average price / m2 of €11,104. This reached €11,364 / m2 in the second quarter (up 2.3%) and €11,792 in the third quarter (up 6.2% from the first quarter).

Immotop.lu also noted great disparity in the evolution of prices and prices / m2 in the different districts of the capital. Various factors can explain drastic increases in the price / m2 in certain districts such as Luxembourg-Kirchberg. In fact, a large part of the advertisements taken into account corresponded to new apartments, but also often included parking spaces or additional services (concierge, gym, etc.), which are present in more and more new construction projects.