Real Estate Market Recovery: A New Momentum
After five consecutive quarters of decline, the residential real estate market showed signs of recovery, according to the Housing Observatory. Housing prices increased by 1% compared to the previous quarter, marking a turning point in the downward trend. Although the overall index still reflects an annual drop of 8.3%, this slight quarterly recovery signals a positive shift for the sector.
Existing Homes: A Favorable Adjustment for Opportunities
The existing homes segment experienced a notable 9.9% annual decrease, opening up interesting opportunities for buyers. This price correction, mainly due to adjustments in response to rising interest rates, allows buyers to find properties at more accessible prices. For apartments, those under construction saw a more moderate decline of 4.3%, while existing apartments recorded a 9.5% decrease, providing a favorable market for investors looking for well-located properties at attractive conditions.
Encouraging Recovery in Real Estate Activity
In parallel with these price adjustments, real estate market activity is picking up. Q2 2024 shows a significant recovery in transactions, particularly in the existing property market. The number of apartment sales surged by 30.5%, and existing home sales increased by 33.8% compared to the previous year. This renewed interest in existing properties demonstrates that buyers are taking advantage of the current environment to acquire properties at competitive prices.
The Market for Apartments Under Construction
Unlike existing properties, the market for apartments under construction remains weak, though showing slight progress compared to the previous quarter. Several factors explain this situation, including the more moderate price decrease in this segment. Indeed, prices for apartments under construction have only decreased by 7.7% between Q3 2022 and Q2 2024, compared to a 15.3% drop for existing apartments over the same period.
Outlook: A Promising Real Estate Environment
With adjusted prices and increased activity, the residential real estate market in Luxembourg offers new opportunities for buyers and investors. Price adjustments enable many buyers to realize their real estate projects despite rising interest rates, while the market’s resurgence suggests growing confidence. The coming months will be crucial in determining whether this positive momentum strengthens, especially in the segment of apartments under construction.