Down Payment in Luxembourg: What You Should Know Before Buying
In Luxembourg, when buying a home (especially if it is not a first residence), a down payment of at least 20% of the property’s value is generally recommended. For rental properties or second homes, this percentage may rise to 30%. For example, for a property worth €500,000, it is common to require a down payment of €100,000 (20%).
For a first residence, some banks may finance up to 100% of the property’s value and, in exceptional cases with strong guarantees, even cover part or all of the associated costs (notary fees, registration, etc.). However, financing above 100% is rare and strongly depends on the borrower’s profile and guarantees.
Property Acquisition Costs in Luxembourg
When buying a property in Luxembourg, it is important to consider not only the purchase price but also additional charges, which can represent a significant portion of the total cost.
Registration and transcription duties, payable at the signing of the deed, amount to 7% of the property’s value — 6% for registration duties and 1% for transcription duties.
However, there is a tax credit known as “Bëllegen Akt” that reduces these costs, up to €40,000 per individual buyer — or up to €80,000 for a couple — provided that the property is purchased as a primary residence and is effectively occupied for at least 2 years.
Additionally, the buyer must pay notary fees, which average around 1% of the transaction value, as well as mortgage registration fees, usually between 0.5% and 1.2% of the loan amount.