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:
Following an error in the formula determining the discount to be taken into account, the calculation sheet was updated on 21/11/2022. Calculations made using the calculator before 21/11/2022 resulted in an overestimated discount for properties acquired between 2 and 15 years after the year of construction of the dwelling in question.
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
Oct 5, 2022
Government Council adopts a series of government amendments on the reform of the rental lease.
rest of Oct, 2022
The error is noticed either by officials auditing the calculator or by users who used it to calculate their discount.
Nov 11, 2022
A new version of the calculator Excel file is made available with the correct amount.