Expert insights: key takeaways from the property market in the second quarter of 2026

Mixed trends in sale prices, prices for new-build flats showing signs of stabilising after several quarters of decline, and a rental market that continues to trend upwards: these are the key takeaways from the second quarter of 2026.

To decipher these developments, we have gathered the views of several specialists in the sector: Pierre Clément (Nexvia), Julien Licheron (LISER/Observatoire de l'Habitat) and Jacques Brauch (SOLUDEC). Price trends, market recovery, financing conditions, buyer confidence and the outlook for new-build properties… all these factors help us to better understand current market dynamics and anticipate future market movements.

Pierre Clément - Managing Director of Nexvia

The actual transaction data analysed by Nexvia confirms the trends observed by atHome in advertised prices: the Luxembourg residential market has entered a phase of normalisation, with slight downward pressure since the start of the year, which has been more pronounced in the apartment segment in Luxembourg City.

Rising interest rates, fuelled by geopolitical tensions and inflationary risks, are reducing households’ borrowing capacity and having a direct impact on prices. Added to this is a wait-and-see attitude linked to continued moderate economic growth, international uncertainties and growing concerns about the impact of artificial intelligence on employment in the country. However, the market is not without its drivers.

The tax package that came into force on 16 July provides significant support for demand, particularly for first-time buyers, thanks to the increase in the tax credit by €5,000 per person (to €45,000) and the expansion of the interest subsidy. These measures should help to maintain a solid base of homebuyers.

The return of accelerated depreciation to 6 % is expected to revitalise off-plan sales amongst investors, whilst owner-occupiers are likely to continue favouring existing properties due to the available tax credit.

Fiscal measures are supporting demand, but the real catalyst for a sustainable recovery will be the return to a more predictable economic and financial environment.

Jacques BRAUCH – Chief Executive Officer and Managing Director at SOLUDEC S.A.

There has been a great deal of talk about the housing crisis in recent years. In reality, the new-build housing market has been experiencing a crisis of confidence.

Whilst the rise in interest rates has put a strain on households’ borrowing capacity, it does not, on its own, explain the slowdown in the market.

On the ground, buyers’ main concerns centred above all on the security of their investment. The difficulties faced by certain developers, which were widely reported, fuelled a climate of uncertainty. Many customers wondered whether their homes would be completed and what guarantees actually protected them.

The Government’s recent measures will help to accelerate a recovery that is already under way. But a genuine economic recovery will depend, above all, on the restoration of confidence.

Buying a property off-plan is, above all, about choosing a reliable partner. Beyond the price, buyers today are looking for guarantees, transparency and security. In our view, it is this renewed confidence that will be the real driving force behind the market in the coming months.

Julien Licheron - Economist at Liser / Housing Observatory

The residential property market in Luxembourg appears to have moved past the most acute phase of the crisis. Transaction volumes have recovered, prices have stabilised and financing conditions are no longer a major obstacle to property purchases.

After several years of sharp fluctuations, the market is gradually returning to a more predictable state, even though the international geopolitical situation raises the spectre of further interest rate rises.

However, this normalisation should not be confused with an end to the “housing crisis”.

Tensions do not disappear; they simply shift. The recovery is currently driven almost exclusively by the existing housing market, whilst the new-build sector remains persistently sluggish. This divergence is the main risk factor for the coming years: fewer homes being built today means greater pressures tomorrow.

The rental market is already reflecting this trend. Whilst sale prices are stabilising, rents being charged for new tenancies continue to rise significantly faster than inflation. This discrepancy shows that the normalisation of the property market does not mean the housing crisis has been resolved. It is simply taking on a different form: less visible in the sales market, but just as prevalent when it comes to access to housing.

In other words, whilst the property market appears to be gradually emerging from the cyclical downturn it has experienced, the structural imbalances linked to insufficient supply remain largely intact.

Read our full analysis of the Luxembourg property market in the second quarter of 2026 right here 👇🏻