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PROPERTY

Property in Austria: Real estate in high demand in Tyrol

Stay up-to-date on the latest Austrian property news with The Local's weekly roundup.

Property in Austria: Real estate in high demand in Tyrol
Buying property in Austria as a foreigner can be tricky - depending on where you are from. Photo by Datingscout on Unsplash

Thinking of buying a house, moving house or investing? Or are you just curious about the property market in Austria? 

Here’s what you need to know.

One in three people in Tyrol want to buy property

Results from a new survey by the Institute for Market Research and Data Analysis (IMAD), shows one in three people in Tyrol want to buy their own property in the next three years, and one third want to buy a privately financed property.

Furthermore, 58 percent of Tyroleans believe more residential properties are being bought by foreign investors.

There are also concerns in Tyrol that property is increasingly becoming too expensive for local people. 

READ MORE: Where are real estate prices on the rise in Austria?

However, leading figures in Tyrol’s real estate industry are now criticising imposed orders on a municipal level to stop construction on privately financed apartments to make way for subsidised housing projects (mostly for local people).

Instead, they say stopping construction on private projects will only exacerbate the problem and increase prices further.

Property prices rose in Vienna in second quarter of 2021

In the second quarter of 2021, real estate prices in Vienna rose by 10.7 percent, according to new figures by Oesterreichische Nationalbank (OeNB).

In Austria, property prices rose by 12.3 percent in the first quarter, and 11.7 percent in the second quarter.

The report looked at property prices in countries across Central, Eastern and Southeastern Europe (CESEE).

Prices and demand for residential real estate in the region continues to be high, despite affordability issues starting to surface in some countries.

The report also noted the construction industry is experiencing shortages of building supplies and labour, which is being reflected in property prices in some countries.

Real estate crowd investing platform to launch in Austria

As the real estate boom in Austria continues, a new option is launching for investors in the form of a crowdinvesting platform.

Rendite Boutique will launch on October 14th with a special focus on sustainable construction projects. The platform allows users to start investing in real estate projects from as little as €50.

Dominic Lorenz, co-founder of Rendite Boutique, says the returns on properties offered on the platform will be between six and eight percent.

Lorenz adds that only projects with a positive financing commitment from an Austrian or German bank are available for investment.

READ ALSO: Vienna tenant has rent slashed because of crime-riddled neighbourhood

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PROPERTY

Where to find property in Austria for under €100k

Austria is not known for being a cheap country and property prices are higher than in some other European countries, but it's still possible to find property bargains, some for even under €100k.

Where to find property in Austria for under €100k

Property prices are rising in much of Europe, and Austria is no exception.

The graph below from the European Union’s statistical agency Eurostat shows the sharp upwards trajectory over the past few years with property price increases in Austria outpacing those in the European Union  as a whole.

And a new survey found that the average price per square metre for new apartments in Austria rose by 11 percent last year, making the country Europe’s second-most expensive market.

It’s no surprise, then, that property ownership in Austria remains low.

According to Eurostat, 55.2 percent of people owned their home in Austria in 2021 – well below the 70 percent European average. That’s the third lowest percentage in Europe after Switzerland (41.6 percent) and Germany (51.1 percent).

READ ALSO: Why do so few Austrians own their home?

So, where can we find cheap(er) homes in Austria – either properties that are move-in ready or those that could be excellent investments for those who enjoy fixer-uppers (or huge DIY projects)?

To find these gems, we used a property website that allowed us to search for real estate in the whole of Austria (instead of just a few main cities) and showed us homes with at least three rooms.

The price limit was set at €100,000 (while our colleagues in even-more-expensive Switzerland had theirs set at a much heftier CHF 500k, around €515k).

As of August 2022, we found 25 houses and 34 apartments meeting these criteria on sale.

As you might expect, many of these need (a lot of) work, but the good news is you can definitely still nab a home for under €100,000 with gorgeous views, small plots of land or lake access.

austria map
Houses below €100k are mainly in the south and east of the country. Property map from Wlllhaben.at.

What types of properties are there?
Looking at houses first (see the map above, which also shows the average purchase price across Austria’s different regions), a few things stand out:

The vast majority of the immediately liveable properties are on the tiny side – most are around the 40 square metres mark and billed as holiday homes – but many come fully furnished, a bonus if you’re working to a tight budget.

You will find bigger ones (the largest we saw was 124 square metres), but then they are likely to be complete renovation projects.

If you head for the border, you’ll get more house for your euro in southern and eastern Austria. Many of the properties we saw were in peaceful Burgenland, Austria’s least populous state.

And if you’re happy to buy just over the border in Hungary, Slovakia or even cross into Croatia, you’ll get more space – and less work – for your money.

You might think cities would be a complete no-no for snapping up bargain properties, but when we looked, we actually found a few properties a short drive from Vienna that were below our top price.

House or apartment?
When it comes to apartments, you’ll get more square metres  – we found flats within this price bracket were around 70 square metres on average – and a slightly greater choice of location for your money

READ ALSO: ‘Concrete gold’: Austria ranks as Europe’s second most expensive property market

Plus, the apartments we found were generally in much better condition – some are even newly renovated and fabulous – so you wouldn’t have so much, if any, work to do.

But there is, inevitably, a compromise: you might get a terrace or a balcony, but most won’t have a proper garden, and certainly no land or outbuildings, which many of the houses we found did have.

If you opt for an apartment over a house, you’ll usually have a slightly greater choice of location. Property map from Willhaben.at.

Even when you do find cheap properties, though, they are sometimes quite literally too good to be true. Some may require completely gutting, others may not be connected to the grid or might need costly lease renegotiations.

So, whether you go for a house or an apartment, you need to make sure you do your homework and carry out a thorough inspection first.

While renovation projects can be great investments, they’re time-consuming and can be very costly.

Before you take the huge step of purchasing, be honest with yourself about your own skill levels and how much time you have for a project – it’s easy to get caught up in the romantic idea of the end result of a gorgeous renovation – and get estimates for any work that needs to be done.

READ ALSO: EXPLAINED: Why Austria’s rising property prices are causing alarm

If you’re looking at buying somewhere to rent out, check average monthly rents for that area to be sure it’s worth you putting all the hard work in and that you’ll get a good return on your investment.

Whatever your reason for buying, check the property’s location carefully – some have poor access or no connection to basic services.

And it’s important to be mindful of extra costs, too: besides renovation costs, you’ll also have to fork out for property taxes, monthly charges, as well as any lease renewal costs and other living expenses.

These can all vary depending on the type of property and where it is.

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