In this article
The rule
Since 1 August 2024, the fees of a real estate agency for a residential rental must be split equally, 50/50, between the landlord and the tenant. The Housing Ministry states it plainly, and the rule applies regardless of which party instructed the agency.
Before the reform, the usual practice was for the tenant to pay the entire commission. That practice is no longer lawful for residential leases signed since August 2024.
What it means in euros
Agency commissions on rentals in Luxembourg have traditionally been expressed as a proportion of one month's rent, plus VAT at 17%. The law does not set the level of the commission; it sets how it is shared.
Take an illustrative case. If an agency charges a commission equal to one month's rent of €2,000, plus VAT, the total is €2,340. Under the new rule, the tenant pays €1,170 and the landlord pays €1,170. Before the reform, the tenant would typically have paid all of it.
Two practical consequences follow:
- The tenant's share is still a real cost, and it belongs in the move-in budget alongside the deposit and the first month's rent. Our guide to what renting actually costs puts it in context.
- A landlord who now bears half the commission has a reason to choose the agency carefully and to expect results. That tends to favour agencies that actually manage the process.
What you are paying for
A commission is paid for work, and it is reasonable to expect that work to be done well. For a residential rental, a competent agency should, at a minimum:
- publish an accurate listing with real photographs of the home;
- answer questions and organise viewings;
- check the tenant's file and the landlord's documents;
- prepare a lease that complies with the law, including the mandatory written form and clauses;
- carry out the entry inventory with the tenant;
- explain the charges, the deposit arrangements and the next steps after signing.
If an agency offers little more than a door code and a lease template, you are entitled to question the value of the fee.
Watch for these practices
The rule is clear, which makes departures from it easy to spot.
A "file fee" or "administration fee" charged only to the tenant
A separate charge for processing your application, on top of your half of the commission, can be a way of shifting the cost back to you. Ask what it covers and on what basis it is charged.
The full commission quoted to the tenant
If a listing or an email says the tenant pays one month's rent plus VAT as commission, ask how that complies with the 50/50 rule. Sometimes it is an old template; sometimes it is not.
Cash, or payment before the lease is signed
Pay agency fees by bank transfer, against an invoice showing the agency's details, the VAT and the split between the parties. Never pay a commission before you have seen the home and received a lease to review. Our guide to rental scams explains why.
Keep the invoice. A proper invoice names the agency, its business permit number, the amount excluding VAT, the VAT, and the fact that it is your half of the commission. It is also useful if you later need proof of your move-in costs.
Private landlords and direct rentals
When you rent directly from a private landlord, there is no agency commission at all. That can save a real amount, but it also removes the intermediary who normally checks the lease and runs the inventory. If you go direct, make sure the lease is written, that it contains the rent, the charges and the deposit, and that an entry inventory is carried out. Our guide to the état des lieux covers the inventory in detail.
How to compare offers with and without an agency
Because the tenant's share is now smaller, an agency listing and a private listing are easier to compare than before. A fair comparison looks at the cost over the whole period you expect to stay, not only at the first month.
Suppose two similar flats are both advertised at €1,800 a month. One is let directly by the owner; the other is let through an agency charging one month's rent plus VAT, of which you pay half, roughly €1,050. Over a two-year stay, the agency flat costs you about €44 a month more. That is a real difference, but it may be worth it if the agency flat is better maintained, if the lease is properly drafted and if you have someone to call when the boiler breaks.
The reverse is also true. A private landlord who is responsive and organised can be the best arrangement of all. The commission is one factor among several.
What the agency's role is after signing
The commission pays for finding a tenant and concluding the lease. It does not automatically mean the agency will manage the property afterwards. Some landlords use the agency only to let the home and then manage it themselves; others sign a separate management mandate. Ask at the viewing who will be your contact for repairs, charges and the end of the lease. Knowing that in advance avoids months of emails to the wrong address.
Leases signed before August 2024
The reform did not reopen leases signed before 1 August 2024. If you paid the full commission under an earlier lease, that payment is not affected. The new split applies to leases concluded since that date.
Our take
The 50/50 rule was overdue. A tenant arriving from abroad with a new job and a deposit to find was paying for a service that mainly benefited the landlord, and the reform corrects that.
At Aura Properties we apply the split transparently and state it on every listing we manage. More importantly, we think a commission has to be earned: accurate listings with real photos, a lawful lease, a proper inventory and someone who answers the phone after you have signed. If you are looking for a room or an apartment, see our current listings or contact us.
Sources
This article explains the general framework of Luxembourg residential lease law and is not a substitute for legal advice on your individual contract. For official procedures and current forms, consult guichet.lu or your commune.
