Q1 2026: Rents under pressure and selling prices on the decline

In the first quarter of 2026, the Luxembourg property market confirmed a slowdown in the transition that began in 2024, following the rebound seen in early 2025. Sales prices are continuing to adjust, with a slightly downward trend that confirms the dynamic begun in the previous quarter.

This movement is reflected in a gradual return to the levels seen a year earlier. Old houses are back below €6,000 per square metre, while old flats are back below €8,000 per square metre after a year of higher levels. While this trend confirms a downturn, it remains measured and is more akin to an adjustment linked to lower transaction volumes.

The new-build segment appears to be more directly affected. After peaking between the first and second quarters of 2025, prices for new flats are continuing to fall, staying below €10,000/m². This trend is taking place against a backdrop of a slowdown in the construction sector and more difficult marketing of off-plan developments.

At the same time, the rental market is characterised by a high degree of stability. After rising at the start of 2025, rents are now moving very slightly from one quarter to the next, particularly for flats, where levels remain high. This situation reflects continuing strong demand, particularly in the most attractive areas, which is helping to keep pressure on prices.

Finally, the trends observed confirm the importance of local specificities in price formation. While some regions are experiencing more pronounced variations, the majority of movements remain contained, reflecting gradual adjustments rather than a uniform national trend. Against this backdrop, the Luxembourg property market is continuing to transform, with balances gradually being redefined between segments and geographical areas.

Sales: selling prices down slightly

Change in advertised sales prices per square metre per quarter

After rebounding in early 2025, sales prices are continuing to adjust. Older houses are back below €6,000 per square metre (-3.3 1Q3Q compared with the previous quarter), while older flats are back below €8,000 per square metre (-1.4 1Q3Q). The new-build segment continues to be more affected, with a more marked fall (-3.3 1Q3Q). These trends reflect a gradual return to the levels seen a year earlier.

Change in advertised sales prices per square metre by region : different dynamics in different regions

Sales prices are evolving unevenly from region to region, with variations contained overall. While some areas are seeing sharper falls, particularly in the north (down by as much as 8.5 % for houses), others are still seeing occasional rises, as in the east for old flats. Overall, the variations remain moderate and reflect local adjustments rather than a general trend.

Location : a stable rental market, but still under pressure

Change in advertised rents per quarter

After rising at the start of 2025, rents are now stabilising. Rents for flats showed virtually no change over the quarter (+0.3 %), confirming a trend that has been very linear for several months. For houses, there was a slight fall (-2.2 1Q3Q compared with the previous quarter), but this did not call into question the price levels seen for several quarters. The rental market is thus reaching a plateau, buoyed by continuing strong demand.

Change in advertised rents by region : the attractiveness of regions shapes rental trends

Rents are developing differently in different regions, depending on their attractiveness and the structure of supply. Much of the demand is concentrated in the Centre region, resulting in a significant rise in flat rents (+6.2 1Q3). In the other regions, variations remain more measured, with some downward adjustments, particularly for houses (up to -10.4 % in the South). These variations illustrate a market in which local factors take precedence over a uniform national trend.

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