Credit: STATEC
Luxembourg's statistical institute, STATEC, recently published the 17th edition of the "Housing in Figures" (Le Logement en chiffres) report, detailing the main findings for the fourth quarter (Q4) of 2024.
As reported by Luxembourg's Ministry of Housing and Spatial Planning, the Housing Observatory and STATEC have jointly published a publication dedicated to the residential real estate market, since 2014.
The latest report showed that housing prices (apartments and houses combined) increased by 1.4% in Q4 2024 compared to Q4 2023, marking the first annual increase since the end of 2022.
Prices for existing housing increased by 2.4% (+3.0% for houses and +1.8% for apartments), while apartments under construction (which correspond to sales before completion) fell by 2.4% compared to the last quarter of 2023.
STATEC noted that developments in this segment remain "highly volatile", as the number of transactions are "very limited"; the market is then subject to strong composition effects (changes in the type and location of construction projects from one quarter to the next). In this segment, adjustment by activity volumes has long dominated (more than adjustment by prices), even if prices have fallen on the projects that have been the subject of transactions.
The Housing Ministry noted that activity in the real estate and land markets continued to grow in Q4 2024. In the existing housing market, the number of transactions was even higher than (for existing apartments) or close to (for existing houses) the norms of the pre-crisis years (2017-2021). The number of transactions increased by 108.2% (for existing apartments) and 77.2% (for existing houses) compared to Q4 2023.
In the market for apartments under construction, the increase in activity was even more marked (+272.6% compared to the fourth quarter of 2023), but the number of transactions represented barely half the pre-crisis average level (2017-2021).
The ministry noted that these price changes relate to notarial deeds registered in Q4 2024, meaning the vast majority of sales agreements signed before the end of November 2024.
The ministry particularly highlighted the decline in housing prices between 2022 and 2024, a development attributed largely to the increase in interest rates set by central banks to combat inflation. According to STATEC's hedonic indices, prices fell by an average of 16.3% between Q3 2022 and Q1 2024, returning to their Q4 2020 level. Since Q2 2024, prices have stabilised and even increased slightly, particularly for existing apartments and existing houses.
This price decline was not uniform; it varied across the real estate market segments. The price decline was both earliest and steepest in the existing homes segment: -21.5% between Q2 2022 and Q4 2023. In the existing apartment segment, the price decline began only a quarter later and was slightly less significant: -15.9% between Q3 2022 and Q1 2024. In the off-plan apartment segment, the decline in activity dominated for a long time, with price series being quite volatile due to a limited number of transactions.
Geographically, the price decline was similar across all areas, with average price reductions per square metre ranging from 16.6% to 19.3%, depending on the geographic area. However, the timing varied. The decline began in Q3 2022 in the canton of Luxembourg, then spread to the canton of Esch-sur-Alzette, before affecting other areas in 2023. The capital played a leading role, with prices falling by around 15% in Luxembourg City between 2022 and 2024.
The ministry also commented on owner-occupied housing prices in the consumer price index (CPI), recalling that the CPI measures changes in the prices of goods and services consumed by households.
The Housing Observatory has also updated its statistics on logement.lu, Geoportail and data.public.lu.
