Looking to find a new home in Austria? Here is all you need to know about housing in the alpine nation, including buying, renting, and local laws.
If you are looking to relocate to Austria, you will be pleased to know that there are many options when it comes to housing in the beautiful alpine haven. There are also many things to consider, such as sustainable housing, hiring contractors, and of course, local housing laws and regulations. You might also want to be aware of some of the key mistakes people make when buying property abroad to avoid making them yourself.
But before you get to that, this helpful guide outlines everything you need to know about housing in Austria, including the following:
- Overview of housing in Austria
- The housing market in Austria
- Housing laws and regulations in Austria
- Buying or renting in Austria?
- Renting in Austria
- Buying a home in Austria
- Affordable housing in Austria
- Sustainable housing in Austria
- Mortgages in Austria
- Selling a home in Austria
- Building a home in Austria
- Useful resources
Overview of housing in Austria
Interestingly, the rate of homeownership in Austria is increasing and stood at 55.4% in 2018. That said, it still sits below the European average of 69%. There are many types of houses to choose from in Austria. These range from charming wooden alpine lodges and cozy cottages in the mountains to urban period houses and renovated flats and chic studio apartments. Short-term rentals are also easily available and both renting and buying a home are fairly simple affairs for both residents and expats.
Typically, housing in Austria is of high quality throughout the country and all new builds are made with high eco-friendly standards.
The housing market in Austria
Currently, a new house in Austria costs an average of €359,000. New-build properties are increasing in cost with the average in Styria sitting just over €300,000, while Lower Austria is up at €338.000.
Interestingly, renovating old apartments has become very popular in recent years with cities like Vienna boasting a plethora of stunning 19th-century buildings that are crying out to be loved. However, if you are looking to buy a unique period property, this will easily set you back at least one million euros. Remarkably, even the COVID-19 global pandemic hasn’t affected the real estate in Austria. On the contrary, the nation’s property market continues to grow with property prices increasing markedly in 2020.
Naturally, the different areas of Austria have quite different rental prices. Overall, without any running costs, the national average rent is €390 per month and Vienna’s average is the same. The lowest average is in Carinthia at €310, while the highest is €500 in Vorarlberg. In Vienna, average real estate prices increased by nearly 10% in 2018.
Housing laws and regulations in Austria
Austria operates a complex system of housing to ensure an adequate supply for its residents. Remarkably, if foreigners have legal residence in Austria for five years, they are eligible for subsidized housing. The income limits for access to housing subsidies are also generous. Typically, only 20% of the population is excluded from this scheme.
Additionally, many new builds are co-financed by the public. In stark contrast to other countries, social housing is designed for more than low-income households. As a result, the incomes of those living in subsidized housing can vary significantly. Subsidized housing in Austria is generally well designed with thoughtful elements such as childcare facilities, swimming pools, and well-kept communal gardens.
Property law in Austria is somewhat tenant-friendly with rent control sitting below free-market levels. Renting in Austria as an expat is also fairly straightforward. Generally, you should be able to rent an apartment with proof of identity, proof of employment, and your Austrian visa. You may also need references from previous landlords.
Essentially, the rent regulations mean that households only spend an average of 21% of their income on housing. This is very low in comparison to countries such as the UK and the US. Additionally, the Supreme Court demands that certain criteria be met before landlords may add surcharges to rents. Rental surcharges may be added for criteria such as access to public transportation, proximity to cultural institutions, and noise emissions.
Buying or renting in Austria?
In Austria, there is no huge disparity of benefits between buying and renting a home. Essentially, there are plenty of protections for renters as landlords have a plethora of obligations to their tenants. That said, buying real estate is also fairly straightforward. And although the initial costs are high, property in Austria is affordable and considered a solid investment. Ultimately, the choice comes down to personal preference.
Renting in Austria
Generally, leases last for three years in Austria. Typically, the security deposit will be one month for each of these years. A three-month notice period is also standard. Renting is made easy as everything is done through real estate agents. You can expect to pay up to two months of rent for the privilege. It is also possible to search privately through newspapers and property websites. However, be aware that if you don’t speak German, you will likely find this difficult.
One great tip for renting in Austria is to choose your season carefully. Chiefly, avoid the time period leading up to the start of school (September). This is when foreign students will be on the hunt for property. Also, as you might expect, prices will be higher for inner-city locations, and these are the highest in Vienna.
Renting out your property in Austria
Letting out your property is a great way to recoup annual costs. However, some areas of Austria are starting to restrict short-term rentals. Essentially, this is due to noisy tourists not respecting residential areas as longer-term residents would. That said, no nationwide action has been taken, although the issue is under consideration. Therefore, you need to check whether you can legally rent your property.
Generally, holiday apartments are privately owned. There are some letting agencies in Austria that will handle operations on your behalf. If you are a permanent resident, you will be exempt from paying the tourist tax. If not, you will likely receive a bill for somewhere in the region of €200 per year. Generally, holiday flats tend to pass the tourist tax on to their guests.
Buying a home in Austria
If you are looking to buy a home in Austria, it’s wise to start looking at some of the property sites that operate in the country. A few good options include Amazing Austria, Engel and Voelkers, Rightmove, Savills, and Tranio. Next, you will likely want to get yourself a local estate agent with knowledge of different neighborhoods and school systems. They will be able to advise you on the best area for the type of property you are seeking.
Then, once you have found your dream home, you can make your offer. Following this, you will receive the dreaded Kostenaufstellung (costs and fees for purchasing a property). Be warned, Austria’s fees are on the high end of the scale, and here is what you are looking at:
- Estate agent’s fee: 3% to 4% of the property value
- Legal fees: 1% to 3% of the property price + 20% VAT
- Property transfer tax: 3.5%
- Notary fee: up to €120 per person + 20% VAT
- Registration duty: circa €400
Assuming your offer is accepted, you will then have an Austrian notary compose your Sale of Agreement. Then you will transfer a deposit of 10% while you wait for the sale to complete. Usually, this takes between 10 and 35 days to allow time for the completion of any relevant property surveys.
Finally, your lawyer will register the transfer with the local registry office. Then, the house is yours and you can move in at your leisure. For further information on the process of buying real estate in Austria, take a look at our in-depth guide.
Affordable housing in Austria
The cost of living in Austria can be high, especially in the capital of Vienna. However, it consistently carries the title of one of the cities with the highest quality of life.
Interestingly, more than 60% of Viennese residents live in subsidized housing. The reason for this? Vienna’s high-functioning social housing system. The city half-owns 440,000 social homes and non-profit co-operatives subsidized by the state own the remainder. Remarkably, these council flats are not built for or habituated by any particular income level of residents. By design, the system mixes low-paid and unemployed tenants with moderate to middle-income levels to aid social integration and avoid any stigma of social class. Vienna does this by continually adding new units – approximately 5,000 annually – and fitting them out to a high standard.
Additionally, when the city collaborates with private developers, they are obliged to rent half of their flats to lower-income residents. Furthermore, the city regulates the rent ensuring that residents never pay more than between 20 and 25% of their income on housing. Interestingly, even if residents’ income levels rise, they are never forced to move out. These buildings also cannot be sold.
The upper limit for a single person to qualify for social housing is €45,510, while for a couple, the upper combined income limit is €67,820. The city’s social housing system is paid with a 1% levy on the salaries of every resident in Vienna. Half of this levy is paid directly from a person’s wages and the other half is matched by their employer.
If you are not an Austrian citizen, you will need to have legal residence in Austria for at least five years in order to qualify for social housing. Additionally, the subsidy only applies to flats that are your primary residence.
Sustainable housing in Austria
Effectively, Passivhaus (Passive House) is the voluntary standard for energy efficiency to reduce a building’s ecological footprint. Generally, buildings that subscribe to the standard maintain ultra-low energy buildings. In fact, Austria created the concept and has the highest concentration of passive houses in the world. Since establishing the standard in 1994, Austria has built more than 14,000 buildings to passive house standards.
In 2009, Austria brought in tough measures to increase energy efficiency in both public and private buildings. Overall, the housing and construction measures are mandatory across the nine states in the nation. Essentially, the policy cuts energy consumption and greenhouse gas emissions in housing. The country began the process of phasing out oil heating and establishing new regulations for heating. Additionally, high-quality building materials and energy-efficient building methods are ambitiously expected. Essentially, Austria is a leader in the EU for its eco-innovation measures in housing, as well as other sectors.
Mortgages in Austria
If you are a member of the EU, it is pretty simple to set up your mortgage. However, although it is very possible, foreigners may have more difficulty getting approval. They also tend to enforce the euro income policy. Recently, banks are lobbying the government to make it easier for overseas buyers to use different currencies to get a mortgage. Generally, fixed-rate mortgages are the most popular in Austria. Typically, a mortgage will go up to 70% of the property with a duration of between 15 and 30 years. Although a riskier option, adjustable-rate mortgages have a lower initial rate of interest. Additionally, there are combination mortgages, which mesh the two types together.
Generally speaking, residency is a condition of mortgage approval in Austria. However, the residency can be a second home. Additionally, it can be held by a business incorporated in Austria. Fortunately, Austria taxes real estate at 0.13%, the third-lowest rate in Europe. This applies to all residents of Austria. And remarkably, citizenship is not a factor when it comes to residency.
When looking into where to get a mortgage in Austria, you will find joint-stock banks, state mortgage-issuing institutions, and building societies all offer this service. Banknoted is a handy website that has all the different options listed, of which there are many.
To get a mortgage in Austria, you will need to prepare the following documents:
- signed property sale agreement (or signed offer to purchase)
- proof of salary (for employees) or proof of company income (for business owners)
- savings account statements
- any other property contracts you own
Importantly, any documents not written in German must be translated by a company such as Lingoking and then notarized. Usually, applications for mortgages take between two and three weeks.
Selling a home in Austria
If you are an expat living in Austria, there are services that deal specifically with the selling of property. One of these, Expat Consulting, provides services in Vienna and can also help with relocation. Additionally, these services can often help you find and purchase your next property through their network of global real estate agents.
Building a home in Austria
As mentioned above, sustainable housing is built into the fabric of the Austrian housing market. Essentially, all new properties in the country use energy-efficient materials and green energy solutions. New-builds in Austria will usually be pricier but there are some decent payment schemes available for these types of properties.