📊 Real estate financing in Luxembourg: what to remember in 2025, and what to expect in 2026?

 

As we approach the end of 2025, it’s time to reflect on the developments that have shaped the Luxembourg real estate financing market — and to look ahead to 2026. Whether you’re buying your first home, investing in rental property, or refinancing an existing loan, here’s a recap of the key points and what to anticipate.

 

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📉 1. Interest rates: from peak to stability

• After peaking above 4% in late 2023, interest rates stabilized between 3.40% and 3.80% in 2025.
• The ECB's easing policy and lower inflation in the eurozone contributed to this normalization.
• Fixed-rate mortgages were the most popular choice again, offering visibility and peace of mind to borrowers.

 

⚡ 2. Energy Passport (EPC): a decisive factor

• Since 2024, banks systematically analyze the energy class of the property during financing reviews.
• Classes A to C may unlock better rates or green loan incentives.
• Classes H and I often require a renovation plan to be included in the loan package.

 

🏡 3. Buyers are better prepared

• More and more clients started their real estate search with a pre-approved financing certificate.
• This allowed them to act quickly and negotiate with confidence, especially in a competitive market.
• Agencies and sellers increasingly favor buyers with a solid financial file.

 

📅 4. Key milestones in 2025

• June 2025: end of most state subsidies (except Bëllegen Akt)
• Fall 2025: stabilization of interest rates, after summer volatility
• End of 2025: increase in financing requests in anticipation of new regulations

 

🔮 5. What can we expect in 2026?

• Green mortgages will gain traction, especially for new and renovated homes with strong energy ratings
• Digitalization of processes will make financing faster and more accessible (e-signature, simulation tools)
• Real estate prices may remain under pressure depending on supply and market confidence

 

✅ MORTGAGE.LU by your side

In 2025, we supported hundreds of families and investors with:

• ✅ Tailored mortgage simulations
• ✅ Rate negotiations with all banks in the market
• ✅ Financing plans including energy renovation works
• ✅ Secure and fast loan applications

 

📞 Ready for 2026?

Whether you’re planning a purchase, a rental investment, or a renovation, now’s the time to act. Our team is here to guide you with professionalism, transparency, and efficiency.

Contact us today for a free consultation and financing simulation!