The Cost of Buying a Property

Understand the taxes, fees and mortgage costs involved in buying property in Luxembourg...

How structurally sound is the property?

The vendor has the obligation to present only one document: the Energy Pass, which details the energy performance of the building. There is no obligation for the Vendor to present a Structural Survey or an Electric Network Survey as it is expected in other countries.

As a buyer, you can reassure yourself by ordering a technical survey carried out by a Building Expert; it will cost you a few hundred euros.

Note that the survey will include an evaluation, but the prepared evaluation will quite likely be based on the replacement costs, but it will not highlight the market price.

Financing a Property Purchase

The current legislation stipulates that if you buy a property to make it your main residence you can borrow up to 100% of the property value as signed at the notary’s.

If you sell your main Luxembourgish residence to buy another one, you can borrow up to 90% of the purchased property value.

If you borrow for an investment, your loan will not exceed 80% of the purchased property value.

You are not obliged to borrow from the bank where you have your current account. Instead, you can contact a mortgage broker who will look for the best deal for your own situation; most major banks are happy to compete to offer you the most suitable deal. Mortgage broker’s remuneration is covered by the banks.

It is likely that the lending bank will request that the loan subscriber also subscribes to a life insurance for the duration of the loan.


Registration Tax

  • If you buy a property that is already built you will be subject to a tax calculated as 7% of the agreed and signed price (the rate is higher if the purchase is not to become your main residence); however, this tax could be reduced by the tax rebate Bëllegen Akt depending on your circumstances.
  • If you buy a property off the plans – yet to be built – the agreed price will be taxed with a mix of the above mentioned 7% as well as with 3% and 7% V.A.T. 

Bëllegen Akt or Tax Rebate

Every first-time buyer in Luxembourg can avail of the Bëllegen Akt hence reducing its Property Registration Tax on their main residence by 20 000 euros per person. 

The notary will reduce the tax bill payable on the day of the signing of the Acte de Vente accordingly.

Notaries' Fees

The property sale is officialised once both parties have signed the Acte de Vente in front of the notary.

The registration tax is payable on that day.

The notary’s fees for transcribing property deeds are fixed by the law. 

The notary’s fees are paid by the buyer. However, both parties have the liberty to use the notary of their choice so there may be two professionals involved instead of one; in such instance, the notary’s fees remain the same, but they are split between both.

Property Tax

The property Tax is annual and is based on the notional rental value of the property. It will vary with the building type, its building elements and the commune where it is based.

It is quite low compared to what it is in other countries. Ask the vendor.

Auction Sales

Auction sales for properties are rare and the associated costs higher than through ordinary sales. Auction sales are listed in most national newspapers and at notaries' offices.


Written by Claire Aumont, www.mondeavenir.lu