Main housing assistance programs
Are you moving to Luxembourg and looking to buy or rent a home? Housing is very expensive throughout Luxembourg, particularly in the central region. But the good news is that financial assistance is available, and the amounts have recently been increased.
To help you plan your real estate project, here you will find all the information you need about the financial assistance available for buying or renting a home in Luxembourg.
Cost of housing in Luxembourg
Housing is very expensive in Luxembourg. Its cost weighs heavily on household budgets in Luxembourg. It is important to note that housing prices have risen significantly in recent years. While purchase prices are now stabilizing or even falling, the same cannot be said for rents. Rental prices continue to skyrocket.
However, financial assistance is available. Find out more below.
Financial assistance for housing
Housing Assistance Service in Luxembourg
In Luxembourg, there is a public service available to answer all your questions about housing. The Housing Assistance Service will help you with any technical or administrative procedures.
Please do not hesitate to contact the Housing Assistance Service for information on housing and financial assistance for housing. You can also contact the Housing Assistance Service for any questions relating to your rent and your rights as a tenant.
It also informs public and private developers about the state assistance they can receive when building housing.
What assistance is available for low-income households?
As a tenant, you may be eligible for financial assistance to rent housing in Luxembourg. This rental assistance is targeted at households residing in the Grand Duchy of Luxembourg whose income does not allow them to afford housing. To be eligible , you must not already own real estate and must have had a regular income in Luxembourg for at least three months.
Rent subsidy in Luxembourg
The most disadvantaged households can receive rent subsidies of €200 to €400 per month to rent accommodation in Luxembourg. The amount is determined based on the composition and income of the household.
The eligibility thresholds were raised in May 2024 to reflectthe increase in the cost of living in Luxembourg in recent months. In addition, the supplement per child is now €80 instead of the previous €40.
State aid for financing a rental guarantee
This scheme to help finance the rental guarantee required by landlords is intended for households that are unable to pay the deposit required when signing the lease. In this case, the tenant must pay the landlord a rental guarantee of up to three months' rent.
Tenants can benefit from the state guarantee if the following conditions are met:
- the rented accommodation must be located in Luxembourg and rented by a private landlord
- the property must be the household's main and permanent residence
- the rent charged complies with the rules of the residential lease agreement.
- the rental guarantee is equivalent to a maximum of three months' rent excluding charges and does not exceed 50% of the household's income.
Renting subsidized housing in Luxembourg
Certain properties in Luxembourg are reserved by the state for low-income households, according to priority. These properties are available from the Housing Fund, the National Society for Low-Cost Housing, or the municipal social services office.
Social real estate agency
Housing is made available for three years to low-income households in exchange for social monitoring.
More information on guichet.lu for assistance with renting accommodation in Luxembourg.
Subsidies for purchasing or building a home
In Luxembourg, individuals wishing to purchase or build a home in Luxembourg to serve as their primary residence may be eligible for a range of assistance to help finance their project.
This assistance may take the form of capital and/or interest payments, or help to secure a loan for the purchase of a home in the Grand Duchy. Applicants must not already own another home.
Subsidy for low incomes
Only low-income households are eligible for assistance with the purchase of a primary residence in Luxembourg. In addition, they must not already own a home in Luxembourg or abroad.
This subsidy is granted based on income, family situation, and type of home. The subsidy ranges from €500 to €10,000, with an increase for condominiums or semi-detached houses. The home must be kept for at least 10 years.
Mortgage interest subsidy
This interest subsidy may be granted to persons with one or more children who have taken out a mortgage of up to €200,000 for the construction, purchase, or improvement of their home. The maximum loan amount is increased by €20,000 per dependent child (up to an additional €80,000).
The interest subsidy reduces monthly payments by applying an interest subsidy of between 0.25% and 2.45%, depending on your income and family situation.
Home savings bonus
The home savings bonus is granted by the government as a one-off payment, subject to certain conditions. It amounts to a maximum of €5,000 and corresponds to the interest and bonuses paid on the savings account or home savings account, at least 90% of which is used to finance the home.
Government guarantee on mortgage loans
Under certain conditions, the government can help guarantee your mortgage up to an amount of €294,824.40. This guarantee is valid on a loan financing at least 60% of your real estate project. The application must be made in the context of prior home savings of a minimum amount of €1,000 per year, over a minimum period of three years with an approved bank.
Additional bonus for architect and consulting engineer fees
Beneficiaries of a construction subsidy for the construction of a new single-family home can obtain an additional subsidy of up to €1,250, corresponding to half of the costs.
Klima Prêt, improving the energy performance of homes
If a climate loan or Klimaprêt has been taken out for the energy renovation of a home that is more than 10 years old and serves as a primary residence, you can benefit from a subsidized interest rate of 1.5% up to €100,000 under certain conditions.
You can also benefit from a Klimabonus Wunnen financing up to 50% of photovoltaic installations with a ceiling of €1,250, or even 62.5% of energy renovation work with a ceiling of €1,562 until October 1, 2024.
The Klimabonus Wunnen also helps finance energy efficiency upgrades and the installation of more sustainable heating systems such as heat pumps or wood-fired boilers.
The project must be carried out with the support of a certified energy advisor. As part of the My Energy assistance program, you can receive free advice if you are a homeowner and want to improvethe energy efficiency of your home. Learn more about the energy passport.
Assistance with the LENOZ housing sustainability certificate
The LENOZ(Lëtzebuerger Nohaltegkeets-Zertifizéierung fir Wunngebaier) certification assesses the sustainability of housing. As part of the process of obtaining this certificate, as a homeowner you can receive financial assistance of up to €1,500 for a single-family home and €750 for an apartment in a multi-unit building.
VAT refund for work on homes over 10 years old
Regardless of your income, you can benefit from up to €50,000 in VAT refunds under the super-reduced VAT rate of 3% for work carried out on a main residence that is over 10 years old or on a new build.
Reduced notary fees under the Bellegen Akt
In addition to all these subsidies, you can benefit from a tax credit of up to €40,000 per individual on notary fees. This measure supports home ownership in Luxembourg. It reduces the costs incurred when signing the deed of purchase for a property as a primary residence.
More information on guichet.lu about the financial incentives available when purchasing a home.
Renovating a home or making special adaptations
In addition to the above assistance, if you wish to renovate your home or carry out work on it, you can obtain a number of financial assistance programs from the government.
Home improvement grant in Luxembourg
This assistance, which corresponds to 40% of the total cost of the work excluding VAT, is available in particular for work aimed at restoring health and safety in a home (more than 15 years old). It may also be granted for the creation of new rooms or the extension of existing rooms. The renovation work must be sustainable: rainwater harvesting, lower energy consumption, environmental protection.
Special adaptations for people with specific needs
Financial assistance is also available for up to 60% of the cost of the work, with a maximum of €20,000. It is granted once, depending on income and family situation, for work intended to improve the habitability of a home for a person with reduced mobility or special needs.
Have you decided to take the plunge and buy or rent your own home? Find agents here to help you find a home to buy or rent.
You can also find more advice on housing assistance at National Housing Week.
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