Luxembourg house prices up 40% since 2010

Luxembourg house prices rose 40% between 2010 and 2017, according to the European Union's statistics bureau.

The country is among the member states with the highest increase, together with Sweden (up 56%), Austria (up 49%) and Latvia (up 47%).

Across the EU, house prices rose 11% over the same period and increased 6% in the eurozone.

House prices, including purchases of new-builds and existing houses as well as flats, have significantly fluctuated since 2006, according to the study by Eurostat.

"Annual growth rates in the EU were around 8% in 2006 and 2007, followed by a fall of 4% in 2009 as a result of the financial crisis," the European statistics office stated. "Prices started growing again in 2014."

Spain (minus 17%), Italy (minus 15%) and Cyprus (minus 9%) recorded the largest decreases.

Household investment down

Furthermore, the household investment rate slightly declined in the EU from 2000 to 2016, Eurostat noted.

“Household investment consists of the purchase and renovation of dwellings. It is defined as the share of investment in disposable income.

"From around 9% between 2000 and 2004, it rose to around 10% between 2005 and 2008, and then dropped to reach 8% in 2016."

Among the member states for which data is available, the highest household investment rates in 2016 were observed in the Netherlands (11.2%), Luxembourg (10.9%), Finland (10.7%) and Belgium (10%).

Latvia (4.5 %), Portugal (4.6 %) and Spain (4.8 %) recorded the lowest rates.

70% homeowners

In the EU, the share of the population that owns their home has been stable at around 70% over the whole period 2010 to 2016, leaving the share of tenants at around 30%.

Three-quarters of Luxembourg residents are homeowners and one-third own more than one apartment.

Overburden

However, housing costs overburden part of the population.

"In 2016, around 11% of the EU population spent 40% or more of their disposable income on housing, which is considered as an overburden housing cost," Eurostat explains.

In Luxembourg, the rate rose from 4.7% in 2010 to 9.5% in 2016.

The member states with the highest overburden rates in 2016 were Greece (41%), Bulgaria (21%), Germany (16%) and Denmark (15%).

Malta (1%), Cyprus (3%) and Finland (4%) had the lowest rates.