Luxembourg’s housing prices are notoriously high, rising 13.9% between 2020 and 2021, with a record 14.5% increase the year before.
The two-day meeting of housing sector players on 11 and 12 May marked the first such get-together of communes, public housing developers, associations dedicated to access to housing and housing counsellors.
“The first national meeting for affordable housing in Luxembourg was a success for all participants,” a statement said. “This constructive and participatory dialogue between the ministry of housing and its partners will be sustained in order to make better progress in realising the right to housing for all.”
Tenants right groups like Mieterschutz but also political parties including déi Lénk and trade unions such as the OGBL have long called for the right to housing to be enshrined in law.
The government has presented a number of solutions to tackle the problem. For example, a revised version of an agreement between the government and communes aims to incentivise local leaders to build more. Communes hold the keys to development plans on their territory.
Commune cooperation
Nearly 100 communes have signed up to this agreement, which gives them access to ministry resources and advisers to put together local housing plans. The first such plan has already been submitted to the housing ministry, which will help communes foot the bill for building projects. Local officials can also count on government support to develop infrastructure needed as municipalities grow.
“I call on all municipalities to continue in this proactive dynamic,” said housing minister Henri Kox (déi Gréng) in a statement. “It is only with the municipalities that we can advance the supply of public, affordable and sustainable housing.”
But other projects are still in their infancy, such as the so-called Baulandvertrag, which will force developers to build faster once they have acquired a piece of land, preventing them from keeping plots idle and speculate on their growing value.
It should also help speed up administrative procedures to pass development plans, which can currently take upwards of one year. The draft law was presented in 2020 but is yet to be voted into force by parliament.
Tax reform
A tax reform to increase levies on empty properties and plots of land is also yet to see the light of day. Prime minister Xavier Bettel (DP) had announced the measure in October 2021, saying a draft law would be tabled within a year, leaving the government five months to make a proposal.
There is enough land available within current building perimeters to construct around 142,000 housing units, research has shown. But nearly two thirds of this land is held in private hands and owners aren’t interested in developing it.
The next meeting of the housing group is scheduled for October, with topics on the agenda including better regulation of the private real estate market, such as more protection for tenants in lease agreements and the health and safety of properties.
