Housing minister Henri Kox will propose several amendments to various bills. He hopes to have them adopted before the end of the legislature. Photo: Matic Zorman/Maison Moderne

Housing minister Henri Kox will propose several amendments to various bills. He hopes to have them adopted before the end of the legislature. Photo: Matic Zorman/Maison Moderne

The National Housing Forum started on Wednesday 22 February. Minister Henri Kox announced that several amendments would be proposed to bills that have started their legislative process.

There is an urgent need to find solutions to the housing problems in Luxembourg. Everyone agrees on this. But when it comes to choosing the solutions, this unanimity vanishes. The morning debates during the first day of the National Housing Conference (the so-called “assises du logement”) on Wednesday illustrated this perfectly, with the minister for housing, (déi Gréng), often “alone against all.”

The difficulty in accessing property ownership, and even in finding housing, is not new. But the situation has gone from being delicate to problematic, even critical, to the point of endangering the competitiveness and growth of a country where finding an “affordable” roof is a challenge. Not to mention the threat to equity and social cohesion. Rising mortgage rates, the slowdown in the construction sector and the lack of housing are making it more difficult for tenants and young people especially.

Since 2018, the housing ministry has been producing reforms, bills, and proposed levers for action, all of which are grouped together in the National Affordable Housing Strategy. But in a changing and increasingly delicate context, Kox stands there like Sisyphus, with a task to be started over and over again.

During the forum, he confirmed that new proposals would be made to support the sector and better protect tenants.

The draft law on affordable housing will therefore be affected by various changes. The Council of State’s opinion is still awaited on this bill, tabled in December 2021. The professional chambers have already made numerous comments. The opinion of the Chamber of Commerce is 30 pages long and that of the Chamber of Trades 27. For a year now, minister Kox has been listening and seeking to make new proposals that will then be cast in amendments. He mainly proposes:

- the introduction of a range of housing intended for specific groups such as young people, the over-60s, employees or members of cooperative societies active as social developers;

- the simplification of procedures for the allocation of affordable rental housing at the request of social landlords;

- the adaptation of the management lump sums to which developers and social landlords are entitled for their efforts, as well as a simplification of the conditions for the approval of the social landlord;

- the inclusion of land made available by natural and legal persons to social developers via a financial lease, with a view to developing affordable housing projects.

The minister also recalled that he favoured tax measures in favour of first-time buyers, in particular “an increase in the tax credit on notarial acts from €20,000 to €30,000 over the next twelve months,” but also the abolition for sales in future state of completion “and for twelve months only, of registration fees on the share of construction already carried out.”

Objective: votes before the end of the legislature

Another cornerstone of the National Affordable Housing Strategy is the draft law on the reform of residential leases, which was also criticised by the professional chambers. Is the fight against excessive rents just wishful thinking? The minister does not believe so and recalls that “the reform of the rent ceiling is essential for the attractiveness of the country, particularly when recruiting additional labour.”

Two changes will also be made here:

- Simplifying the annual thirds rule. The bill provides for rent increases of more than 10% to be applied automatically under the "annual thirds" scheme. This means that an increase of more than 10% must be spread equally over three consecutive years, before having to wait another two years to apply a new rent increase. It is proposed to replace the one-third annual rule with a two-year limit on rent increases of 10%. As a result, rents may not be adjusted upwards by more than 10%.

- Strengthen the consideration of renovation efforts. In the determination of the invested capital, revalued and discounted, which serves as a basis for the calculation of the rent ceiling, it will be specified that the expenses related to the renovation and improvement of the dwellings will only be discounted from the moment of their effective realization. This approach makes it possible to take better account of major energy renovation work and to encourage landlords in general to fight against the dilapidation of dwellings.

Kox, who sometimes has little political support and is even rather isolated, remains unfailingly optimistic. He intends to formalise these amendments in the weeks and months to come, and to have the bills voted on before the end of the legislature. The pressure will be on, as failure to do so would stain the coalition agreement reached in 2018.

The second day of the housing forum will take place in May.

The Paperjam + Delano Business Club is organising a round table discussion on the housing crisis with, among others, Henri Kox on 28 March.  

This story was first published in French on . It has been translated and edited for Delano.