Luxembourg 2024: Major Housing Reforms!
Major Housing Reforms in Luxembourg: An Overview of New Measures and Their Impact
In response to the acute housing and construction crisis in Luxembourg, the government recently unveiled an ambitious set of measures aimed at stimulating activity in the sector. The announcements, made at a press conference on Wednesday, indicate a clear political will to move from rhetoric to concrete action. This article will dive into the details of these new measures, exploring their scope and potential impact on the Luxembourg real estate landscape.
1. Highlighting Taxation to Stimulate Business
Faced with a major crisis, the CSV-DP government has chosen to play the tax card to breathe new life into the real estate market. Immediate measures for 2024 include a reduction in capital gains tax, an increase, and the creation of tax credits. These actions are clearly intended to encourage the purchase and sale of real estate, while boosting the rental market.
2. Financial Assistance for Households
The measures component also includes financial assistance schemes, both short and long term. In addition to temporary measures such as an increase in interest expense and a partial tax exemption for housing benefits for those under 30, individual subsidies apply. The maximum amount of rent subsidy per child has doubled, and substantial supports are provided to facilitate access to home ownership.
3. Massive Investments in Affordable Housing Construction
The state has announced ambitious plans for investments in housing construction. By 2027, 800 units and 480 million euros are planned, with a total investment of 923 million euros over the period 2024-2026 to create affordable housing. The objective is clear: to finance the activity while meeting the pressing needs of the market.
4. Financial Challenges and Future Prospects
However, the cost of these measures for public finances remains unknown. Current estimates place the fiscal impact at around 135 million euros, but this will depend heavily on the activity generated by these reforms. Prime Minister Luc Frieden underlined the need to face this structural challenge while calling for national unity.
5. National Meeting and Future Perspectives
Recognizing that these measures may not completely solve structural housing problems, Luc Frieden convened a national housing meeting on 22 February. This meeting in Senningen aims to open the dialogue on other solutions and measures to be taken in the coming months and years. The government remains determined to apply its program to address housing challenges in Luxembourg.
In conclusion, the new government measures demonstrate a strong political will to revitalize the Luxembourg real estate sector. However, their success will depend on a variety of factors, including market acceptance, the economic activity generated, and the ability to solve associated financial challenges. The national meeting scheduled for February promises to be an important forum for discussing long-term solutions and for establishing a national consensus on the future of housing in Luxembourg. Stay tuned for updates on how this situation evolves.