Eric Van Driessche, sales manager in housing advisory at Banque Internationale à Luxembourg (Bil), outlines the key arguments for buying versus renting a home.

Pros and cons of renting

Flexibility: “The main advantage of renting is flexibility. One of the key factors is how long someone plans to stay in Luxembourg. If someone says, ‘Okay, I’m coming to Luxembourg for two or three years, but I’m unsure about the future,’ then I think renting makes more sense,” says Van Driessche.

Cost: “Typically, rent is lower than the cost of repaying a mortgage. Also, under the new rental law, rent cannot exceed 5% of the landlord’s investment, and agency fees are now split: half paid by the landlord, half by the tenant. So newcomers usually need to cover the first month’s rent, a two-month deposit and half a month’s agency fee. This relatively modest amount is generally significantly lower than the equity contribution required for a real estate acquisition.”

Pros and cons of buying

Building wealth: “The main argument is purely financial: over the long term, property markets generally perform well and can generate capital gains. In Luxembourg, any profit from selling a main residence is tax-exempt,” continues Van Driessche. “Also, repaying a mortgage is a form of forced saving. We see that people who have bought property--even if only by retirement--end up with assets and are often in a better position than those who have rented all their lives.”

Freedom to personalise: “You can arrange your home as you wish and you are free to keep a pet if you like, which is generally not allowed in rental situations.”

Timing: “Now is a good time to buy. Prices have dropped, interest rates are lower than a year ago and government support schemes are also helping--for now at least.”

The verdict?

“If you know you’ll be staying in Luxembourg for the medium term, buying is worth considering,” says Van Driessche. “Otherwise, renting is the safer option.”

Find your home sweet home now

Whether you’re looking to rent, buy, co-live or cross the border, being prepared is key. The best places go fast, and the best deals often don’t show up on standard listings. Know your budget, your timeline and your lifestyle priorities… then act quickly when the right opportunity comes along.

Housing: the market at a glance

After a sharp rise in prices over the decade, the housing market is showing signs of stabilisation. For example, by the end of 2024, property prices had increased by 1.4% compared to the previous year (-2.4% for new-build flats, +1.8% for existing flats and +3% for existing houses), according to data from Statec.

Here’s a map of the average rent for flats.

Here’s a map of the average sale price for existing flats.

For houses, the situation is less varied than for flats. While prices are indeed higher in the capital and neighbouring municipalities, the disparities with the rest of the country are less pronounced. The national average for a house is €1.18m.

As for rentals, the downward trend in rents that began at the end of 2024 continued into the first quarter of 2025. House rents fell by 1.8% compared to the previous quarter, while flat rents declined even further (-2.5%). This reflects, according to experts, a rebalancing of the rental market, with supply gradually adjusting to demand after a period of tension. On average, renting a flat in Luxembourg costs €1,779 per month, while the average monthly rent for a house is €3,152.

Here’s a map of the average sale price for existing houses.

Furnish on a budget

Rob Vintage, Hollerich (Luxembourg): Offers unique vintage furniture with a focus on design. The shop also features “pre-loved” items, including higher-end pieces.

Oddhaus Vintage, Mühlenweg: Just a stone’s throw from Bonnevoie, Oddhaus offers vintage furniture and original décor items from the 1950s to the 1980s. Each product is unique and carefully selected.

Stock2, Bertrange: Ideal for secondhand office furniture and other professional equipment.

Troc.lu, Esch-sur-Alzette: This secondhand shop offers a wide selection of furniture, from household appliances to décor, including classic furniture and bedding.

Okkasiounsbuttik, Differdange: In its new shop you can find secondhand and creatively refurbished furniture.

Nei Aarbecht, Lorentzweiler: This socially focused shop helps people in social distress reintegrate into the workforce. The store offers a variety of second-hand items.

Luxpuces, Dippach: Combines an indoor flea market in Gostingen with a shop in Dippach. It sells a wide range of secondhand goods.

This article was written for the August/September 2025 issue of Paperjam magazine (Expat Guide), published on 10 July. The content is produced exclusively for the magazine. It is published on the site to contribute to the full Paperjam archive. Click this link to subscribe to the magazine.

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