Source: https://www.imf.org/en/News/Articles/2023/03/10/luxembourg-staff-concluding-statement-of-the-2023-article-iv-mission

Persistent imbalances in housing markets and higher rates are likely to further worsen housing affordability in the short term. Building on efforts to curb speculative demand and land hoarding, the authorities should continue to focus on boosting supply, while avoiding measures that increase housing demand (such as the recent increase of the Bëllegen Akt’s tax credit and the deductibility of interest payments). In staff’s assessment housing prices are overvalued, following several years of double-digit growth. Public sector purchases of dwellings under development should be avoided as it could impede a price correction that would enhance affordability. In this context, the authorities could consider frontloading public investment in social and affordable housing, and should expedite efforts to reduce supply bottlenecks, including by allowing greater density of buildings and by reducing the administrative burden.

6 comments

  1. This is the IMF that is predicting growth of the Russian economy in excess of that the Russian dictatorship is predicting… yea I’ll pass on taking their advice villmols merci.

  2. Luxembourg politicians just prolong inevitable. Lux is a victim of own success. Everyone thinks that prices can go up forever. Of course they won’t, and now middle class professionals are refusing Lux offers because they know math and they know they can not afford 6k mortage for 30 years or 2,5k a month to rent average 2 bedroom place.

    Good luck with 1MEur barns

  4. Luxembourg definitely is not anyone’s long term plan. It is a stop over for career and it’ll remain so unless the housing is affordable and quality of life is improved.

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