Luxembourg Real Estate Prices: Q2 2026 Market Report
Towards a Sustainable Normalization of the Luxembourg Real Estate Market
The latest joint reports from the Housing Observatory (Observatoire de l'Habitat) and STATEC reveal a paradigm shift for the residential sector in the Grand Duchy. After a year 2025 marked by significant fluctuations related to the end of temporary fiscal measures, the market now seems to be embarking on a path of stability in 2026.
A Significant Increase in Transaction Volumes
Data published by the NextImmo platform and official bodies confirm that activity has regained momentum. In the first quarter of 2026, the number of transactions for existing apartments reached 968 sales, a 9.4% increase over one year, nearing pre-crisis standards (average of 1,032 sales between 2017 and 2021) [3].
Existing houses also showed progress with an 11.5% increase over twelve months (650 sales) [3]. This positive dynamic follows an exceptional second quarter of 2025, where sales of existing apartments jumped by 72.9% following the imminent expiration of fiscal incentives on June 30, 2025 [1].
Price Evolution: The End of Volatility?
The hedonic price index, calculated by STATEC, shows a moderate overall increase of +1.7% year-on-year in the first quarter of 2026 [3]. This figure marks a clear break from the crisis years:
- 2023: Price decline of -9.1% [2].
- 2024: Price decline of -5.2% [2].
- 2025: Start of a turnaround with an annual increase of +1.6% [2].
The existing house segment remains the most vigorous with a growth of +3.0% over twelve months, while apartments (both new and existing) show a more modest increase of +0.9% [3].
Persistent Fragility in New Builds (VEFA)
Despite the general optimism, the Sale in Future State of Completion (VEFA) segment is struggling to recover. The number of transactions fell by 18.2% in the first quarter of 2026 compared to the same period the previous year [3]. Although prices in this segment are relatively stable (+0.9%), activity remains far below the average 650 quarterly sales recorded before the 2022 real estate crisis [3].
Rental Market Under Pressure
While sales prices are stabilizing, the rental market continues to weigh heavily on household budgets. Advertised rents for apartments increased by +4.4% year-on-year in the first quarter of 2026 [3]. This increase is nearly three times higher than inflation, which stood at 1.6% over the same period [3]. This disconnection between sales prices and rents reflects the high rental demand in urban centers like Luxembourg City or Esch-sur-Alzette, due to the lack of easy access to property ownership for first-time buyers.
Sources
- Press release: Logement en chiffres n°18
- Le logement en chiffres - Fourth Quarter 2025
- Analysis Report n°25 - 1st Quarter 2026
- Housing: prices and evolution city by city - Paperjam
- Logement en chiffres #19 - Full Report