Construction and housing
Hardly any issue has been so neglected by governments in the past 35 years. It was declared “Chefsache” [a top level issue] under Junker, and became an
“absolute priority” (Gambia coalition).
It is almost bizarre to see that the latter tries again and again to make the joker card stick to the CSV, and vice versa.
Here is the truth: since Fernand BODEN (CSV), almost everything that could be done badly has been done badly in this area!
There was generally twice as much demand as supply. You don't need a PhD in economics (not even if it's been stolen) to understand that this is bound to raise prices significantly.
And then come our brilliant ministers.
Instead of investing in rental housing through private investors, they have:
a) increased VAT on rental housing from 3% to 17%
b) made tax deductibility (“accelerated tax depreciation”) significantly less attractive.
The outcome? Rents have increased!
Investors are no longer buying homes to rent them: this results in a reduced supply, while demand remains almost equivalent. That means higher rents.
In many countries around the world, investment in rental housing is subsidized by the government. Many countries have a significantly more attractive program than Luxembourg: why then should cosmopolitan individuals prefer to invest in Luxembourg? You don’t have to be a “globalized capitalist” to change your mind…
DECREASE REGISTRATION
The state collects a disproportionate sum for each real estate sale! Where, for example, in the Netherlands a tax of 2% is required when buying a home, in Luxembourg it is 7% (excluding “bëllechenacte”).
Politics, as is often the case, gets in the way! Yes, we are also for the construction of rental housing, at affordable prices, by the state, parastatals and municipalities. But honestly: can they handle it? And what prices must they (meaning us, as taxpayers) pay?
It's absurd: no one builds faster or at lower cost than the private sector! Denying it for ideological reasons is simply stupid! Private investment is necessary!
So where is the problem?
First of all, our government denounces the existence of “vacant premises”. Why are the apartments/houses empty? It's very simple: the owner wishes to keep his property for one of his children or grandchildren, because he must go through a long and expensive procedure to obtain the sale of the accommodation in question on the desired day.
If the landlord was sure that his tenant was forced to move out on a certain date (fixed-term contract with rapid execution in the event of occupancy beyond that date), he would of course rent!
The same applies if the owner wishes to sell in the near future: who would buy a property for personal use, but which is rented by a third party?
The same is true for renovation of rental houses: 15 households out of 16 have moved and the 16th is blocking the work: as a result, 15 homes are empty. A rapid and simple procedure could help here.
In the case of inheritance, houses/apartments are often empty until all heirs have been found or have obtained ministerial approval: quicker and simpler procedures could also be useful in this case.
Therefore: If you want to tax so-called “vacant premises”, you should think about the origins of this situation and simplify and shorten civil laws and procedures.
Another problem: how is it that a couple, for example, has been paying 1,500 euros in rent for years, but is refused a loan of 1,350 euros to buy? Shouldn't our state bank fulfil its social role? Our “Triple-A” state bank still belongs to us, the citizens...
THE SPECIAL DEVELOPMENT PLAN (PAP) IS TAKING TOO LONG
PAP procedures really take an incredibly long time and fail due to foolish reasons. Instead of a barn (without historical significance), 3 semi-detached houses could be built in a village... for 15 years. Can we take this seriously?
Investors and developers are losing heart: there is less construction while demand has remained the same. How does the state, clumsy as it is, think it will catch up?
It’s not possible.…
YES, there are some owners who covet building land excessively and there must be strong taxation. But as far as the normal owner is concerned: you have to respect your property!
We welcome the ambitious projects of the state but we wonder if it is enough? Isn't it necessary to build on green spaces near cities, so that ordinary citizens could become OWNERS, instead of tenants.
Yes, the ability to create wealth through real estate ownership has helped many people so far and should be possible tomorrow too!
We are delighted that there is now a national register of social rental housing! This should make where need exists and also who can now be prioritized for such accommodation more transparent.
We condemn state administrations, municipalities and even the Chamber taking advantage of HOUSING SPACES to operate offices. This must end.
The same goes for state or municipal housing which sometimes remains empty while waiting for a project to become concrete in many years! (City of Luxembourg – Neudorf/Neiduerf)
As is often the case, the state looks for the fault in others before looking at itself...
Another idea is that individuals who rent rooms or lodging to socially disadvantaged people would be exempt from tax on the modest income thus generated.
Flat-shares are also possible in principle, but subject to such restrictive regulations that they will probably not change much.
This is all unfortunate and could be improved with little effort towards more freedom...
