The comparable method in Luxembourg real estate
The comparable method (or direct comparison approach) is the most intuitive and widely used valuation technique for residential transactions in Luxembourg. It estimates property value based on recent transaction prices of similar properties in the same geographical area.
Property transactions are recorded by the Registration and Domains Administration (AED), and aggregated data is published by the Housing Observatory. The EVS (European Valuation Standards) recommends a minimum of 3 relevant comparables, ideally 5-10.
Selection criteria for comparables
Choosing relevant comparables relies on several similarity criteria:
- Location: same municipality, ideally same neighbourhood. Price gaps between neighbourhoods can reach 20-30%
- Property type: apartment vs house, number of bedrooms, habitable surface
- Age: same age bracket (new, < 10 years, 10-30 years, > 30 years)
- Energy performance: same or adjacent EPC class
- Transaction date: ideally less than 12 months old
Adjustments and weighting of comparables
No comparable is perfectly identical. Adjustments are needed:
- Surface: price/m² adjustment with decreasing returns
- Condition: +5 to +15% for fully renovated, -10 to -20% for properties needing renovation
- Floor and orientation: +2 to +5% per upper floor for apartments
- Parking: EUR 25,000-50,000 per indoor space in Luxembourg City
Using comparables for informed decision-making
Property comparison is essential for setting sale prices, purchase negotiations, investor due diligence and judicial appraisals. Our tool lets you compare up to 4 properties simultaneously with normalised metrics.