If you intend to stay in Luxembourg for more than 5 years, you might consider buying property in Luxembourg, although renting is typically advised first to know the area. Taxes related to home ownership are favourable in Luxembourg. Thanks to the Bëllegen Akt, a tax credit introduced by the Government in order to reduce the incidental expenses associated with the purchase of a dwelling, transaction costs are limited. Registration and transcript fees are reduced to € 100 for any purchase up to € 285,714 for a single person or € 571,428 for a couple (7% of the price of the property above this threshold). Mortgage interests are tax-deductible and the property tax is very low, in comparison to other neighbouring countries. And when you come to sell, there will be less tax to pay on the realized capital gain if you have owned the property for at least two years.
There are a range of loans and grants available for homebuyers in Luxembourg. Your entitlement largely depends on your personal circumstances. To see if you are eligible, the best thing to do is to contact the Housing Assistance Department. If it is hard for you to get a mortgage, it may be possible to get help in the form a State guarantee. If you meet particular conditions, the State assume a part of the guarantee for your mortgage housing loan. You can find more information about the State guarantee and application forms on the Government website.
Like rental properties, properties for sale are generally listed in newspapers, online property portals and agency websites. Another option is to visit the site www.notariat.lu where you can find the list of public auctions of real estate conducted by notaries. The website is also useful if you are looking for a notary. A notary is required to administer all property transactions. Notary fees are fixed by law and tend to be around 1,5% of the property’s value.
Finally, take into account that once you agree to purchase a property, you’ll need to pay a deposit. How much deposit you pay will depend on the mortgage deal you have secured, but it is common to pay a deposit of up to 25%.