Luxembourg City

1. Bilingual Society: Luxembourg City is known for its multilingual population, where three official languages—Luxembourgish, French, and German—are commonly spoken. This linguistic diversity reflects the city’s rich cultural heritage and makes it unique in Europe. 2. Caves and Fortifications: Beneath the city lies an extensive network of underground tunnels and caves, known as the Bock Casemates, which were originally built as fortifications in the 17th century. These tunnels provide a fascinating glimpse into the city's past and are a UNESCO World Heritage site. 3. Green Spaces: Despite being a bustling city, Luxembourg City is home to numerous parks and green spaces, such as the Parc de la Ville and the Pétrusse Valley, which offer scenic views and recreational opportunities. These areas contribute to the city’s reputation as one of the greenest capitals in Europe.

Luxembourg City's housing market is characterized by high demand and limited supply, leading to elevated prices. As of 2025, the average price for residential properties in the city is €11,969 per square meter for sale, showing a 4.96% decrease from the previous year. Rental prices average €34.36 per square meter per month, a 6.58% increase from 2024. The city owns 49 housing units, with plans to increase this number through new construction projects. The total housing stock in Luxembourg consists mainly of apartments (52.8%) and houses (45.9%). While specific figures for Luxembourg City are not provided, the country-wide trend suggests more people live in houses than apartments. Luxembourg City is the center of rental market activity, accounting for over 55% of apartment rental listings in the country. The average advertised rent for apartments in the city was €1,724 per month or €38.56 per square meter in early 2023. Public and social housing play a role in addressing affordability issues, but their share of the market is not explicitly stated. Housing cooperatives are emerging as an alternative model, offering communal living and potentially more affordable options, though their current market share appears limited. The city's housing market shows signs of stabilization, with a positive outlook for 2025 due to government measures and decreasing interest rates.

The Luxembourg City administration is actively addressing the housing crisis through various initiatives. The city owns and rents out 618 affordable housing units, with strict eligibility criteria based on household composition and income caps. Applicants must meet specific conditions, including age, residency rights, and not owning other properties. The government has introduced reforms to tackle housing delays, including measures to increase affordable housing, simplify permit approvals, and encourage sustainable development. Key changes include allowing construction in activity zones, increasing the percentage of affordable units in new projects, and introducing the "silence means agreement" principle to streamline administrative processes. Luxembourg aims to create at least 1,200 affordable housing units between 2022 and 2025. The government plans to acquire 800 flats from the private market over the next 3 years to offer at affordable rents, with a budget of 480 million euros. Additionally, the budget for public affordable housing over the next 2 years is nearly 1 billion euros. Other initiatives include tax credits for landlords, reduced taxes on added value when selling homes, adjusted rent subsidies and state guarantees, and increased tax deduction limits for homeowners. The city is also focusing on sustainable urban planning, as seen in projects like Elmen and Neischmelz, which prioritize quality of life, sustainability, and community spirit.

Housing cooperatives play a limited but growing role in Luxembourg City's housing landscape. While the city primarily focuses on traditional affordable housing models, there is increasing recognition of cooperative housing's potential to address affordability and community integration challenges. The city of Luxembourg owns and manages 618 affordable housing units, allocated based on legal criteria including income caps and residency requirements. However, specific programs or policies promoting cooperative housing in Luxembourg City are not widely established. Adhoc, Luxembourg's first non-profit housing cooperative, has been working to promote and develop cohousing projects in the country. They aim to provide ecologically built and socially oriented housing where members actively participate in planning and community structuring. One notable project was a pilot community housing initiative in Luxembourg's Kirchberg district, developed in cooperation with the public developer Fonds Kirchberg. However, this project was discontinued in early 2021 due to conflicting conditions set by Fonds Kirchberg that Adhoc, as a non-profit cooperative, could not meet. While cooperative housing is not yet a significant part of Luxembourg City's housing strategy, there is growing interest in alternative housing models. The city and national government are beginning to recognize the potential of cooperatives to create affordable, sustainable, and community-oriented housing solutions.