Financial expert warns of difficult real estate situation for young people in Austria and calls for rising rental costs.

Financial expert warns of difficult real estate situation for young people in Austria and calls for rising rental costs.

According to a report by www.wienerzeitung.at, real estate prices have been falling for some time and at the same time the ownership rate is decreasing. This makes it particularly difficult for young people to have access to their own home, as rising prices and difficult financing make the dream of owning their own home increasingly unrealistic. Rising interest rates on loans, new lending guidelines and inflation are making it more difficult to realize your dream of owning your own home. These developments have various effects on the real estate market.

Demand for houses collapsed

According to Re/Max Immospiegel, 21.6 percent fewer properties were sold in the first half of 2023 than in the same period last year. Demand has plummeted, particularly for properties in the range of 400,000 to one million euros. In the capital Vienna, real estate sales have reached the level of 2015. This downward trend shows that the demand for purchasing real estate has fallen significantly.

Housing costs place a greater burden on tenants

Rising housing costs are putting more strain on tenants than on owners. According to a study by the Vienna University of Economics and Business, renters have a higher share of their housing costs in their disposable income compared to property owners. Young households in particular are affected by this burden.

Property in Austria is still attractive

Despite the challenges mentioned, purchasing real estate in Austria remains attractive. However, more equity and assets are required to purchase a home. The tax burden when purchasing home ownership is low compared to other countries, which continues to make purchasing property attractive.

Overall, it appears that developments on the real estate market in Austria point to a more difficult situation for potential buyers. The falling demand for real estate, the rising housing costs for tenants and the funds required to purchase home ownership are challenges that influence the real estate market. It remains to be seen how these trends will develop in the future.