Housing aid A wide range of benefits and services to help you feel at home

Adequate and quality housing is a key factor that contributes to people's well-being, it applies to tenants and owners of real estate. Luxembourg is committed to the right to housing, which fosters social cohesion, through a series of housing subsidies that have already been made available. Furthermore, a major reform of the legal framework is currently underway and will allow for the creation of affordable housing in the future as well as improvements to the individual support scheme. Find out more about the key assistance available for tenants and landlords, including support for sustainable housing and energy efficiency.

Housing support for tenants

State support to find suitable housing

The first step on to the property ladder can be daunting. Therefore, Luxembourg offers a helping hand to tenants by helping them to find suitable housing. This can be achieved via the private real estate market, but the public market, with its subsidised housing, is a starting point that should not be ruled out.

The two local partners who manage the rental of subsidised housing are the Fonds du logement and the Société nationale des habitations à bon marché.

In the framework of the Fonds du logement, subsidised housing is rented to low-income households or to non-profit legal entities whose social purpose includes the provision of housing to disadvantaged sections of the population. The conditions of access and practical terms are clearly set out on the Fonds du logement website.

For its part, the Société nationale des habitations à bon marché provides two types of offers:

  • Social housing: the company is the owner of housing intended for the social housing market. This accommodation is exclusively rented to people who do not own a property in Luxembourg or abroad. Check their website for more information about the conditions and registration.
  • Affordable housing: the company manages affordable housing. The housing stock is made available in return for a monthly occupancy fee calculated according to the occupants' income. The objective of this approach is to facilitate access to renting for individuals who are not eligible for social housing because their income is too high, however it is also too low to rent housing on the private market. All the information is available on the company's website.

Social rental management

Persons on low incomes with difficulties accessing the housing market also have the option to rent a property as part of the social rental management programme. A partner, approved by the Ministry of Housing, provides affordable housing adapted to the composition of the household for a maximum period of three years. During this period, the tenant must agree to be monitored by social services. The list of approved partners is available on the logement.lu website.

State support for renting

On the one hand, you can obtain a rent subsidy. This financial support is intended for adults who are legally resident in Luxembourg, who have a low income and who already rent or wish to rent accommodation. The housing in question must be used as the main and permanent residence. All the information, as well as the application forms, are available on guichet.lu.

A short introduction to a rental lease agreement and the rental deposit

A rental lease, or a residential tenancy lease, is an agreement whereby the owner (landlord) of a dwelling and a tenant freely set the term and specific conditions of the rental agreement. The legislation in force on rental agreements applies only to accommodation used as the main place of residence let out to natural persons. This agreement may be verbal, but for greater security it is advisable to enter into a written rental agreement. The law stipulates that maximum amount of rent that the landlord can demand cannot exceed 5% of the amount which he has invested in the building, except in the case of social housing and luxury housing. Le Fonds du logement has provided a brochure and a calculator to allow you to calculate the maximum rent for a rented accommodation.

When the rental lease agreement is concluded, the landlord may demand the payment of a rental deposit; this sum may not exceed three months' rent. The purpose of the deposit is to serve as a guarantee for the payment of the rent, the additional charges, and any damage that may be caused to the property.

On the other hand, you can ask for financial support to finance the rental guarantee. This support is intended for adults who are legally resident in Luxembourg and who wish to rent accommodation, but do not have the necessary means to finance the rental deposit demanded by the landlord. Under certain conditions, the Ministry of Housing can act as the guarantor. In return, the tenant will have to commit to saving the total amount of the rental deposit over a period of three years. All the conditions, as well as the application forms, are available on guichet.lu.

Housing support for landlords

State support to find suitable housing

As in the case of tenants, Luxembourg also helps future owners to find housing on the public market. The two local partners who manage the purchase of subsidised housing are the Fonds du logement and the Société nationale des habitations à bon marché.

Within the framework of the Fonds du logement, the acquisition of subsidised housing is intended for people who satisfy certain conditions, such as being a natural person and occupying the housing for personal use only as well as not owning real estate in Luxembourg or abroad. All the practical details and the forms are available on the Fonds du logement website.

For its part, the Société nationale des habitations à bon marché offers fully completed, turnkey housing based on certain criteria such as income and wealth thresholds. The company currently has three housing projects available for sale in Contern, Olm and Sandweiler and another seven projects in the pipeline. Find out more here.

Other State aid

In addition to subsidised housing, support for the purchase of housing is organised in four parts: Direct aid in the form of a capital payment, financial aid for interest on loan repayments, indirect financial aid (tax benefits) and grants for sustainable housing and energy performance.

Direct aid in the form of a capital payment

  • Purchase subsidy. The amount of this subsidy is set according to the income and situation of the family making the application. It can vary between EUR 250 and 9,700, with increases of +30% for joint ownership properties and +15% for semi-detached houses. The subsidy can only be awarded once to the same beneficiary.
  • Construction subsidy, with similar amounts and conditions as the acquisition subsidy.
  • Savings subsidy. If you have saved in order to buy or build a home, you may also be eligible for this subsidy. This aid is linked to the purchase and construction subsidies; the maximum amount is EUR 5,000.
  • State home loan guarantee. To be eligible for a mortgage, banks will demand a guarantee. If a person is unable to provide sufficient guarantees for the purchase, construction or renovation of a dwelling, the State can help guarantee the loan.

Financial aid for interest on loan repayments

  • An interest subsidy. This subsidy makes it possible to reduce the monthly charges for the repayment of a loan for the purchase, construction or renovation of a dwelling used as a main residence. The loans are taken into consideration up to a maximum amount of EUR 175,000.
  • Interest relief. You are eligible if you have at least one dependent child. It reduces the monthly cost of the mortgage loan for the purchase, construction or renovation of a dwelling by 0.50% per child. This aid can be accumulated with the interest subsidy.

Indirect financial aid: tax benefits

Several indirect subsidies are currently available. Please consult all the details on the taxation section of the Ministry's housing portal (logement.lu), as well as the practical details of the procedures to be carried out on guichet.lu.

Subsidies for sustainable housing and energy performance

Today, housing must meet the three requirements of sustainable development: ecological, economic and social. To address these issues, the Ministry of Housing has set out two components:

Financial support in constant evolution

The Klimabonus programme was launched in spring 2022 in response to climate change and in order to fast-track the transition to a more ecological, energy-efficient and socially conscious way of life. The housing segment of the scheme, the Klimabonus Wunnen, aims to simplify the procedures for accessing grants for energy renovation projects and to make alternatives to fossil fuels more accessible. More information about the Klimabonus scheme is available on the Klima-Agence website.

Developing the pathway towards a consolidated right to housing

At the start of 2022, Luxembourg announced an ambitious reform of the legal framework on housing. Housing support will be reformed by two bills that will replace the current law, which is more than 40 years old. The first bill will establish a clear framework for financing affordable housing and supporting its inhabitants. The second bill will extend and simplify individual support schemes for housing, both rented and owned in the private market. The objective is clear-cut: to ensure the right to housing and, by extension, foster social cohesion.

"This targeted policy demonstrates a strong commitment to the right to housing in order to guarantee a dignified, sustainable and quality life for all." Minister for Housing, January 2022.