Old or New House: Which Investment Is More Profitable in Luxembourg?

Publié le 1/26/2025

Old or New House: Which Investment Is More Profitable in Luxembourg?
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The Luxembourg real estate market is one of the most dynamic in Europe, but choosing between an old house or a new one for a profitable investment can be complex. Each option has unique advantages and constraints to consider. Here’s a comprehensive guide to help you make the best decision.


1. Initial Costs: Advantage for Older Homes

Old houses often have a more affordable initial purchase price compared to new constructions.

  • Price per Square Meter: Older properties are often located in central or already developed areas, and their price may be lower because they do not meet modern standards.
  • Notary Fees: The fees for purchasing an old property can be higher than for a new one, as taxes differ.

However, you should also factor in renovation costs, which can increase the total investment.


2. Quality and Comfort: New Builds Take the Lead

New houses adhere to the latest standards in construction, energy, and comfort.

  • Energy Standards: A new house typically features high-performance thermal and acoustic insulation, along with modern systems like heat pumps or solar panels.
  • Modern Design: Spaces are designed to maximize natural light and optimize surfaces.
  • Ten-Year Warranty: New constructions often come with a 10-year warranty covering structural defects.

3. Location: Older Homes Dominate

Old houses are often situated in established residential areas, close to city centers, public transport, and amenities.

  • Attractiveness to Buyers: If you plan to sell or rent, the location of an older property can attract more potential buyers or tenants.
  • Green Spaces: On the other hand, new constructions are typically located on the outskirts or in developing areas, offering more potential for modern, open spaces.

4. Renovation and Maintenance: New Builds Offer Peace of Mind

With an old house, renovations are often needed to modernize installations or improve energy efficiency.

  • Costly Renovations: Insulation, roofing, heating, or electrical systems often require updates in older homes.
  • Maintenance Costs: Older properties may involve higher recurring maintenance expenses.

In contrast, a new house is move-in ready and requires little to no major interventions for years.


5. Profitability and Resale Value: Older Homes Have Historical Value

If you’re planning to resell, older homes in strategic locations tend to maintain or even increase their value over time.

  • Potential for Added Value: A tastefully renovated older house can sell for more than the initial investment.
  • Target Audience: Buyers often appreciate the charm of older homes combined with modern improvements.

New houses, on the other hand, attract buyers looking for a move-in-ready home, but their value may stagnate if supply increases too much.


6. Taxes: New Builds Are More Advantageous

In Luxembourg, new properties often benefit from attractive tax reductions.

  • Reduced VAT: New constructions may qualify for a reduced VAT rate for primary residences.
  • Grants and Subsidies: Investments in new builds may be eligible for subsidies related to energy efficiency or sustainability.

Old houses do not always offer these benefits, although some grants may be available for energy-efficient renovations.


7. Sustainability and Environment: New Builds Ahead

New constructions meet modern environmental standards, limiting their ecological impact.

  • Sustainable Materials: New builds use eco-friendly and recyclable materials.
  • Lower Consumption: A new house consumes less energy, reducing its carbon footprint.

However, renovating an old house can also contribute to sustainability if ecological improvements are made.


Conclusion: Which Choice Is Right for You?

The choice between an old or new house in Luxembourg depends on your personal priorities and budget. A new house offers comfort, energy efficiency, and peace of mind, while an old house can provide a prime location and unique charm with the potential for added value after renovation. Consider the initial costs, required work, and tax advantages to make a strategic and profitable investment.


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