When considering a real estate project in Luxembourg, the choice between a new or existing property goes far beyond aesthetics or budget. This decision has major implications for financing, taxation, timelines, ancillary costs, and even the credit conditions negotiated with banks.
⏳ 1. Timelines, disbursements and deferrals: a different financial rhythm
🏠 Buying existing property:
- Fast and linear process: sales agreement > financing > notarial deed within 2 to 3 months
- Loan disbursed in full on the day of the deed
- Immediate repayment (or short deferral possible)
🏗️ Buying new (VEFA or construction):
- Multiple financing phases: down payment, calls for funds, final delivery
- Full or partial deferral during the construction period
- Average duration of 12 to 24 months before handover
💶 2. Tax benefits and aid for new-builds
- 3% VAT (instead of 17%) on the first €50,000
- Bëllegen Akt tax credit: €40,000 per person
- Lower renovation or maintenance costs in the short term
Aid is rarely available for older properties unless major energy renovations are eligible.
⚠️ 3. Constraints in existing properties: EPC, renovations, resale
- Energy Passport rating H or I: negative impact on rate/conditions
- Renovation plan sometimes required for financing
- Risk of devaluation over time due to environmental non-compliance
👥 4. Which profile suits which type of property?
| Profile | New-build | Existing |
|---|---|---|
| First-time buyer | ✅ VAT + state aid | ✅ More affordable |
| Investor | ✅ Rental-ready, no work | ✅ Higher potential yield |
| Long-term resident | ✅ Comfort + tax | ✅ Central neighborhoods |
| Urgent project | ❌ Construction delays | ✅ Fast signing |
| DIY / value-add | ❌ Limited customisation | ✅ Renovation potential |
🏦 5. What do banks look at?
New-build:
- EPC rating A to C = preferred interest rates
- Deferral of amortization negotiable
Existing:
- EPC rating D to I = stricter credit review
- Renovation plan may be required and integrated into the loan
✅ Why work with MORTGAGE.LU?
- ✅ Custom analysis of your project
- ✅ Comparison between new and existing properties
- ✅ Optimization of tax and financing structure
- ✅ Access to the complete offer of Luxembourg banks
🧩 Conclusion
Your choice between a new-build and existing property will directly affect your financing strategy, your eligibility for state support and your banking conditions. Our brokers are here to guide you toward the most advantageous and secure solution.
Contact us for a free analysis of your real estate project!
