New housing measures in Luxembourg: what you need to know

The new measures for housing in Luxembourg The measures announced in July 2026 could have a direct impact on future homeowners, young first-time buyers and investors. Collectively known as the «Booster fir de Wunnengsbau», these measures aim to boost construction, make it easier to get on the property ladder and increase the supply of affordable housing.

However, not all measures follow the same timetable. Some are set to apply to transactions carried out from 16 July 2026 onwards, whilst others will come into force in 2027 or only after the Act has come into force.

A total of seven measures were presented. Here are the key points to bear in mind and how they could affect your property project in Luxembourg.

Please note : Several measures still require the adoption of implementing regulations. The final arrangements may therefore be subject to change.

Why are new housing measures being introduced in Luxembourg?

The government wishes to take action across several areas: funding, investment and the construction of new homes.

These measures are aimed, in particular, at achieving the following objectives:

• to make it easier to buy a main residence; ;
• to support young people and first-time buyers; ;
• to reduce certain acquisition-related costs; ;
• to encourage investment in the rental market; ;
• expand the supply of affordable housing; ;
• to encourage the launch of new property developments.

They therefore cater to a range of different groups, including prospective homeowners, households, investors and property professionals.

What measures apply to future homeowners?

There are several measures aimed directly at people wishing to buy a property to use as their main residence. These include off-plan purchases, the «Bëllegen Akt» tax credit and financial assistance for property purchases.

1. An exemption for certain off-plan property purchases

The first measure relates to the purchase of a new-build property sold off-plan, also known as a VEFA purchase.

When an individual buys a property to serve as their main residence, they may be eligible for a exemption from registration fees and transcription of the section relating to the construction.

To be eligible, the property must be completed by A maximum of 80 % at the time of acquisition. However, the duties will still be payable on the value of the land.

What conditions must be met?

According to the government’s press release, the measure is aimed at:

• to individuals; ;
• when purchasing a main residence; ;
• for off-plan properties; ;
• properties that were at least 80 per cent complete (%) at the time of acquisition.

The scheme is set to run for three years, for acquisitions completed from 16 July 2026.

People who sign their deeds between the announcement of the measure and the entry into force of the law should be able to submit an application to the Registration, Land and VAT Authority.

An example of the savings for a main residence

The government gives the example of a property bought off-plan at a price of 1 000 000 €, including 250 000 € are in line with the site.

Under the previous system, the buyer still had to pay 19 500 € registration fees following the use of the Bëllegen Akt for €40,000.

Under the new provisions announced, the fees would be calculated solely on the basis of the value of the land, i.e. €17,500. The new Bëllegen Akt, worth €45,000, would cover this amount in full.

In this example, the purchaser would therefore no longer pay registration fees. They would also retain 27 500 € against his tax credit for any future eligible purchase.

2. The Bëllegen Akt increased to €45,000

The tax credit on notarial deeds, known as Bëllegen Akt, is expected to rise from €40,000 to €45,000 per person.

It is intended for private individuals who are buying a property for their own personal use. For example, a couple could benefit from a total tax credit of up to 90 000 €, provided that each purchaser meets the specified conditions.

According to the government, this new limit would make it possible to buy a property worth approximately 640 000 € without having to pay registration fees.

How much will the new ceiling save?

For a completed property purchased for €1,000,000, the registration fees amount to €70,000 in the official example.

Under the previous Bëllegen Akt, with a value of €40,000, the buyer still had to pay €30,000. With the new ceiling of €45,000, this amount would fall to €25,000.

The additional saving would therefore amount to €5,000 per person.

This measure applies to acquisitions made on or after 16 July 2026. For transactions entered into before the Act came into force, an application must be submitted to the relevant authority.

3. Increased support for buyers

The Government also plans to expand several support schemes designed to make it easier to buy a home, particularly for young first-time buyers and households.

An enhanced interest subsidy for young first-time buyers

Young people wishing to buy their first home could also benefit from an increased interest subsidy.

This benefit is designed to reduce part of the interest burden on a mortgage. The amount paid depends, in particular, on income and household composition.

Where at least one of the borrowers is aged Aged 35 or under, the maximum loan amount taken into account when calculating the grant is set to rise from €200,000 to €300,000.

Consequently, some young households could receive a higher monthly allowance.

An example for a young household :

The government gives the example of a household with one dependent child, with an annual net income of €79,000 and receiving an interest subsidy of 1.5 %.

Thanks to the new ceiling of €330,000, this household could receive up to €400.31 per monthor An extra €133.43 each month.

Incentives extended to young homebuyers

Young people buying affordable or moderately-priced homes should now be able to benefit from two forms of financial assistance:

• the home-buyer’s grant; ;
• the savings bonus.

To be eligible, at least one of the future owners must be aged 35 years of age or under at the time of purchase.

This change is aimed, in particular, at helping young households to build up the deposit required to secure their mortgage.

An enhanced interest subsidy for all households

The increase in the limits does not apply solely to young first-time buyers.

For all households, the ceiling for eligible loans is expected to rise from €200,000 to €250,000.

Furthermore, the allowance granted for each dependent child would rise from €20,000 to €30,000. The maximum limit could therefore reach 370 000 €, depending on the household composition.

These improvements should benefit not only new applicants, but also those whose claims are already being paid.

An example for a household with one child :

In the example provided by the government, a household with one dependent child and an annual net income of €79,000 could receive a maximum monthly payment of 339,66 €.

This represents an increase of €72.78 per month thanks to the increase in the maximum loan amount taken into account.

What measures apply to rental property investment?

Others new housing measures in Luxembourg are aimed more at investors. In particular, they relate to the VAT applicable to certain affordable rental properties and to the tax depreciation scheme.

4. A reduced VAT rate of 8 % for certain affordable rental properties

A reduced VAT rate of 8 % is available for certain rental properties that meet criteria set by the Government.

To qualify for this rate, the property must, in particular:

• have a maximum area of 120 m² ;
• be offered at a price lower than or equal to the median reference price ;
• to be rented for at least ten years to a certified tenant by the Ministry of Housing and Regional Planning; ;
• to comply with a rental yield capped at 4 % of the net invested capital.

Unlike certain measures aimed at buyers, this reduced VAT rate will not apply only from the date on which the Act comes into force. There are no plans for the measure to have retroactive effect.

5. A new accelerated depreciation scheme

The government is also planning to introduce a new accelerated depreciation scheme to improve the profitability of certain rental investments.

This scheme is based on the «three times six» principle:

• a depreciation rate of 6 %; ;
• for a period of 6 years; ;
• on a maximum depreciable basis of €600,000 per property.

If the depreciable base exceeds €600,000, a rate of 2 % should apply to the entire base, with no time limit.

For acquisitions made in 2026, taxpayers could choose between the current scheme and the new scheme.

From 1 January 2027, the new scheme would become the only one applicable to new purchases. Previous schemes would, however, continue to apply until their expiry for purchases already covered by them.

6. A community bond planned for 2027

The package also provides for the creation of a citizens’ bond scheme called Housing Bond.

The total amount is expected to reach 250 million euros. The funds raised would be used to support the financing of affordable housing.

Interest should be exempt from the 20 % final withholding tax.

The launch of this bond issue is scheduled for early 2027.

7. An additional 300 million euros for off-plan property sales

Finally, the Government plans to invest an additional 300 million euros as part of its off-plan property purchase programme.

The first programme, with a budget of 480 million euros, enabled the State to acquire or set aside 830 affordable homes.

The scheme is now set to become more flexible. The government will be able to purchase only a portion of the homes in a development, rather than having to acquire the entire development.

This measure can help secure a portion of the sales. It can also help the project reach the pre-sales threshold required by the banks and, as a result, facilitate the start of construction.

What is the timetable for the new measures?

The dates of application vary depending on the scheme:

• from 16 July 2026, subject to the Act coming into force: exemption on the construction element of certain off-plan property purchases and an increase in the Bëllegen Akt; ;
• for acquisitions made in 2026 : option to choose between the old and the new depreciation schemes; ;
• from 1 January 2027 : new depreciation scheme applicable to new acquisitions; ;
• at the start of 2027 : planned launch of the Housing Bond; ;
• upon the Act coming into force, without retroactive effect : Reduced VAT to 8 % for certain affordable rental properties.

It is therefore important to check the timetable and the specific conditions for each measure before making a decision.

What are the key points to note about the new housing measures in Luxembourg?

These new measures could make it easier to buy a home, support investment in rental property and contribute to the development of new housing in Luxembourg. However, the conditions and dates of implementation vary depending on the scheme. It is therefore advisable to check your circumstances with the relevant authorities or your solicitor before embarking on a property project.

For prospective homeowners, the key points to bear in mind are:

• the Bëllegen Akt increased to €45,000 per person; ;
• exemption from registration duties on the construction element of certain homes purchased off-plan; ;
• an increase in the interest subsidy; ;
• the extension of certain grants to young people buying affordable homes.

For their part, investors may be interested in the reduced VAT rate of 8 % for certain affordable rental properties and the new accelerated depreciation scheme.

However, the conditions and effective dates vary depending on the scheme. It is therefore advisable to check your specific circumstances with the relevant authority, your solicitor or a specialist adviser.

Do you have a property project in Luxembourg?

Before you start your research, take a look at our guide on the steps to buying a property in Luxembourg. This will help you plan your budget more effectively, anticipate the costs associated with your purchase and understand the key steps you need to take.

Next, discover the Properties for sale in Luxembourg on atHome and refine your search according to your budget, preferred location and the type of accommodation you’re looking for.