Housing crisis

Private land owners uninterested in building, data shows

There are not enough housing units for all in Luxembourg, despite there being enough buildable land.  Photo: Shutterstock

There are not enough housing units for all in Luxembourg, despite there being enough buildable land.  Photo: Shutterstock

Of the 5,018 hectares of building land the government identified in 2021, 419 could be mobilised immediately, housing minister Henri Kox (Déi Gréng) said in answer to a parliamentary question, but owners hesitate to start developing.

In November, the ministries of housing and energy had, in a joined report, revealed that there are 5,018 hectares of potential building land available in Luxembourg. Energy minister Claude Turmes (déi Gréng) had suggested that 142,000 new housing units could therefore be built. 

“85% of the land can be mobilised directly without legal or physical obstacles (e.g.risks of landslides, flooding, topographical difficulties, etc.),” Kox writes in his answer. However, the vast majority (64.2%) of the building land for residential use that was identified in the study is owned by several private residents who make up 0.5% of the grand duchy’s population.

16.6% (618 ha) of buildable land consists of building gaps, he also explained, empty plots in already built-up areas.

Among individual owners, however, the desire to develop, sell or build is relatively low: they’re interested in developing only 23% of their land. However, individual persons own the highest amount of land (64.2%), while private businesses (20%) and public owners (13.5%) have access to smaller shares.

In 2021, one of the main issues identified by the ministries was that this monopoly on land is a direct contributor to the housing crisis Luxembourg faces. The privatisation of buildable land is partly to blame for the flare-up in housing prices, the report said. 

The housing pact 2.0, the introduction of a national property tax and the so-called 'Baulandvertrag’, which would force developers to start building more quickly after purchasing land, and a reparcelling project aim to push towards the mobilisation of buildable land.

In the meantime, 419ha of the land are technically usable immediately, while 265ha of land already located in existing residential areas could be developed immediately. For “Baulücken”--land gaps between buildings--communes will first have to estimate the interest of owners for development before calculating the starting time of eventual works.