Is there a risk of a price drop? Salzburg real estate market in crisis!

Is there a risk of a price drop? Salzburg real estate market in crisis!

The Salzburg real estate market is currently experiencing a complex development that is influenced by various factors. Hölzl & Hubner Immobilien, a renowned real estate marketing company in the region, regularly carries out analyzes to evaluate the market. Data from the Salzburg Real Estate Index (SIX), which evaluates the transactions of the Salzburg District Court over three decades, is included. The latest analysis for 2024 shows a decline in both sales figures and, in some cases, prices.

The main reasons for this development are high interest rates and difficult financing conditions caused by persistently high inflation. While the prices for existing apartments, houses and land have fallen, new apartments are showing a notable price increase. Despite this, this segment is suffering from declining transaction numbers, reflecting an overall real estate market situation that is compounded by the nationwide housing crisis. Managing director Katharina Hubner says that the SIX has recorded a decline for the third year in a row, but she still believes in a future upswing that should be based on stable economic growth.

Current market activity and price trends

In contrast to the trends reported by Hölzl & Hubner, Mark Hüsges, Managing Director of Engel & Völkers Salzburg, notes a certain resilience of the real estate market in Salzburg and the surrounding area. He explains that there is currently increased market activity with increasing transaction volumes. However, prices for condominiums will decline slightly in the first half of 2024, which also applies to single-family and two-family homes.

The situation is complex, as rental prices in the city of Salzburg have increased by up to 2%. Data shows that top prices for residential properties in the Salzkammergut can reach up to EUR 11.8 million. Current average values ​​show that the price per square meter for condominiums in Salzburg is EUR 5,700, which represents a decrease compared to the previous year. The average purchase price for single-family homes is EUR 1,050,000.

Forecasts and market development

The forecasts for the real estate market in Salzburg are mixed. Condominiums are expected to have a likely number of 780 to 910 transactions, while single-family homes are forecast to see 130 to 150 transactions. In very good locations, the prices for single-family homes and condominiums reach astonishing heights, while in the Salzkammergut there is high demand with limited supply.

The analysis shows that the market in the Salzkammergut continues to be characterized by high demand for premium properties, despite the challenges presented by the market as a whole. The second half of 2024 could see a pick-up in the market, giving both buyers and sellers hope that conditions will improve and price trends will become more stable.