In Luxembourg, several state aids help borrowers to become owners of their main residence. These benefits can take the form of direct capital grants or interest subsidies for the repayment of a loan.
With atHomeFinanceIn this section, we have reviewed the support available for buying a property in Luxembourg.

Direct aid for a property purchase

The state guarantee

If you want to become a homeowner or carry out work, but you cannot offer sufficient guarantees to your bank or financial institution of choice, there is a solution to help you: the state guarantee.

The State can in fact act as guarantor and help people who cannot obtain a property loan due to a lack of sufficient guarantees such as a personal contribution or a mortgage. The State then offers a guarantee that can represent up to 30 % of the loan amount.

In order for the State to accept to act as guarantor, you must have opened a savings account for at least 3 years and have funded it regularly. The minimum deposit required is €290 per year (the calculation of the 3-year period begins on the date when the balance in your savings account reaches €240). This is one of the most important buying aids if you have limited means.

Another condition is that you must also have obtained approval for a loan of at least 60 % of the amount of the property to be acquired or the work to be carried out. Finally, the rate of your mortgage loan must not exceed 3 %.

The acquisition or construction premium

When building or buying a property, you can benefit from a direct purchase subsidy from the Luxembourg government, known as a purchase premium or construction premium.

It is therefore a capital grant that can be obtained for the construction of a dwelling (single-family house or flat) in the case of a first occupation or for the acquisition of an existing dwelling. The amount can vary between €250 and €9,700.

This premium is determined according to your income, marital status and the type of construction of your home. In the case of a condominium or townhouse, the premium is increased by 30 %. For a semi-detached house, the premium is increased by 15 %.

You can claim the construction or acquisition premium if you have taken out a mortgage loan with a bank for the purchase of a home in the Grand Duchy of Luxembourg. This property must also be used as the main and permanent residence of your household for a period of at least ten years.

Help to buy: the savings premiume

This savings bonus can be granted, under certain conditions, to mortgage holders in the context of a property project. This is a capital grant from the state.

In order to benefit, you must have built up savings for the purpose of buying a property. The amount of the bonus corresponds to the interest and bonus on the applicant's savings account or home savings account at the time the home loan is granted. One of the conditions is that at least 90 % of the funds saved must be used to finance the property.

The maximum amount of the savings premium may not exceed the sum of 5,000 euros and may be granted only once to the beneficiary.

To apply, you must be legally entitled to reside in Luxembourg, be domiciled and reside there. You must also be in receipt of an acquisition or construction premium or a generalized housing savings scheme.

Help to buy in interest

After detailing aid in the form of direct premiumsLet's see what they are interest support for the repayment of a mortgage.

The interest subsidy

In order to reduce the costs of repaying a mortgage loan taken out as part of a property project, the State may grant interest subsidies. This is one of a wide range of grants for buying in Luxembourg. You may be eligible if the property for which you are taking out a mortgage loan is to be your main and permanent residence. This condition must be met for as long as the aid is paid.

For the calculation of the interest subsidy, mortgages are taken into account up to EUR 175,000 (this amount is amortised from 1 January 2010).^er payment of the aid). As for the interest subsidy rate, it can vary between 0.575 % and 2.45 %. It is based on your income and marital status.

The interest subsidy can only be awarded once per applicant.

The interest rate subsidy 

The interest rate subsidy is also a assistance in interest offered by the Luxembourg State and reserved for people who have taken out a property loan for the construction, acquisition or improvement of their home. This interest subsidy allows the lending rate to be reduced by 0.5 % per child (however, in no case may it exceed the effective rate of the loan and the ceiling rate of 3 %).

This aid is collected monthly or half-yearly by the applicant. It is calculated on the basis of interest, in accordance with the repayment plan drawn up by the bank, and in such a way as to reduce your interest rate by 0.5 % per child. For the calculation of the interest subsidy, loans are taken into account up to 175,000.

The interest subsidy can be combined with other state aid.

Help to buy: the tax credit or "Bëllegen Akt

In order to reduce the ancillary costs associated with the purchase of a home, you can benefit from a tax credit on registration and transcription fees (also known as "Bëllegen Akt") when you purchase a property for your own use.

This tax credit is limited to 20,000 per purchaser. For a couple, this amount is doubled.

To qualify for this tax credit, you must therefore acquire your property to establish your main residence, but also commit to living in the property for a minimum of 24 months.

The Registration and Domain Administration will in any case charge a minimum of €100 as registration fee.

All these aids set up for the State are granted under conditions (income, family situation, nature of the property, etc.). For more details and application procedures, you can visit the website www.guichet.lu.