The Luxembourg Ministry of Housing Publishes Incorrect Spreadsheet

Background and Incident

On October 5, 2022, together with the reform of property taxes and unoccupied housing, the Government Council of Luxembourg adopted a series of amendments to a bill on the reform of the rental lease. It intended to strengthen the protection of tenants and bring more transparency to the lessor-tenant relationship in the private market. A key element of the amendments was the complete revision of the rent ceiling mechanism to effectively protect tenants from usury rents.

As a part of these amendments the government provided an Excel Spreadsheet calculator for the tenants and lessors to calculate the rent discount. The initial version of the spreadsheet contains an error leading to overestimating the discount for certain properties:

Impact and Spreadsheet Error

We do not have information about how the error was discovered or how many incorrect estimates were made during the use of the flawed calculator. It is not known if any financial decisions were made based on the results of an incorrect calculation. No information is available about the essence of the particular formula error.

Available on the government's website, the final workbook contains two sheets. The calculation sheet is:

There is also a look up table for the yearly coefficient in the second sheet:

Due to the error being described as "overestimated discount for properties acquired between two and 15 years after the year of construction" we can assume that the values in the second sheet were entered incorrectly.

Timeline of Events

Sources

• Logement.lu - Draft reform of the legislation on residential tenancies reviewed and completed ⧉ .
• RTL Today - Error found in spreadsheet, Ministry of Housing admits ⧉ .