For members


EXPLAINED: How Austria’s new property buying rules could impact you

Anyone buying property in Austria will now need a minimum deposit of 20 percent. Why has this new rule been introduced and how could it impact people trying to get on the property ladder?

EXPLAINED: How Austria's new property buying rules could impact you
The latest Deloitte Property Index shows prices have increased by 11 percent in Austria. Photo by Waldemar Brandt / Pexels.

From August 2022, anyone applying for a mortgage in Austria will be subject to new rules related to equity and terms and conditions for loans.

The aim is to take some heat out of the property market in Austria, especially after both the Austrian National Bank (OeNB) and the European Council for Systemic Risks recently issued warnings that lending criteria was too lax, according to a report by ORF.

But for some, it will now mean home ownership will become an ever more distant dream as property prices, interest rates and the cost of living continue to rise.

Here’s what you need to know.

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

What has changed?

The biggest change to house buying rules in Austria is that there is now a mandatory deposit of 20 percent of the value of a property, including additional costs. Previously, banks were simply issued with recommendations about a minimum deposit.

As a result, the OeNB expects a “dampening effect” on the number of home loans being granted in Austria, followed by a drop in property prices in the coming years.

However, in an interview with Der Standard, Willibald Cernko, the new head of Erste Group, called for exceptions for young families who are particularly impacted by the new lending criteria.

Cernko said: “There may be good reasons for the new regulations, but in my view they pay too little attention to young people and those on low incomes. 

“Where are young families supposed to get 20 percent of their own capital, even if both work, unless mum and dad or grandma and grandpa step in?”

FOR MEMBERS: Property buying rules for international residents in Vienna

Another change to the property buying rules in Austria is that mortgage repayments must not exceed more than 40 percent of a buyer’s income.

According to calculations by ORF, this means someone hoping to buy a home for €360,000 (an amount which rarely exists in some regions due to high prices) would need a net income of €3,250 per month to qualify for a mortgage. It is estimated that half of all Austrian households would not qualify.

Additionally, mortgages can only be granted for a maximum of 35 years and loans must not exceed 90 percent of the calculated market value of a property.

READ ALSO: How to keep your apartment cool in Austria this summer amid rising energy prices

Are there any exceptions?

Yes, loans of up to €50,000 will not be impacted by the new rules, which is good news for those seeking finance options for renovation works in their homes, for example.

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For members


Property buying rules for foreigners in Tyrol and Vorarlberg

While many countries have a north-south divide, Austria is often split between east and west, and it’s no different when it comes to property.

Property buying rules for foreigners in Tyrol and Vorarlberg

The west of Austria is home to the Alps and many famous ski resorts, making it a highly sought-after place to buy property – for both Austrians and foreigners.

But the popularity of this part of the country has led to skyrocketing prices and strict rules on who can and can’t buy property.

Thinking of investing in a home in Tyrol or Vorarlberg? Here’s what you need to know.

READ ALSO: EXPLAINED: The rules for buying property in Graz as a foreigner

Who is a foreigner in Austria?

Foreign nationals are defined by the Austrian Federal Government as people that do not have Austrian citizenship.

But when it comes to buying property, there are varying rules for different foreigners. This mostly depends on whether someone is from an EU country or not (rather than whether they have an Austrian passport).

Property buying rules for EU and EEA citizens in Austria

It can be easy for citizens from EU and EEA countries and Switzerland to buy property as a foreigner in Austria.

This is because these citizens are granted the same rights as Austrian nationals under EU law.

So this means whether you are an EU citizen already living in Tyrol or Vorarlberg as a resident, or you simply want to purchase an investment property in the Alps, then it is possible.

FOR MEMBERS: EXPLAINED: Property buying rules for international residents in Austria

Brits with an Article 50 card

For people with an Article 50 Card – a post-Brexit residency permit that grants Brits living in Austria before December 31st 2020 pre-Brexit rights – they are still treated the same as those from EU member states. 

But for any British people that have moved to Austria in post-Brexit times, they will be considered as third country nationals and subject to the rules detailed below. 

Nationwide property-buying rules for third country nationals

In Austria, the term ‘third country nationals’ refers to anyone who is not from an EU member state, an EEA (European Economic Area) country (Iceland, Liechtenstein and Norway) or Switzerland. 

For this group, it is usually more difficult to buy property in Austria – even for permanent residents – due to strict rules.

In principle, any permanent residents from a third country in Austria have to go through an authorisation process to gain a special permit that will allow them to buy property. 

The reason for the permit is to ensure there is sufficient housing available for Austrian citizens and to avoid surging property and land prices from interest by non-EU buyers.

But the rules for foreigners buying property in Austria are regulated by the Foreign Nationals’ Property Acquisition Act of each province, which is why they can vary across Austria.

READ MORE: Where to find property in Austria for under €100k

What is different in Tyrol and Vorarlberg?

In Tyrol and Vorarlberg, only EU, EEA and Swiss nationals are allowed to buy property as a foreigner. British people with an Article 50 card are also included in this group.

This means third country nationals are not allowed to purchase property in these states.

Innsbruck, one of Austria’s most beautiful – and expensive – cities. Photo: Photo: Wikicommons

Why are the rules different in the west of Austria?

In a bid to reign in the property markets in Tyrol and Vorarlberg, governments have introduced measures such as caps on the number of holiday homes in certain districts. Third country nationals are also prohibited from buying property.

However, this has led to some international residents being pushed out of the market, like a Serbian couple who were denied a permit to buy a house in Tyrol in 2021, despite living and working in the province for 20 years.

In Vorarlberg, there are also special laws in place to restrict where holiday apartments can and can’t be built to protect the local housing stock.

Likewise, a property in Vorarlberg can only be used as a holiday home within specially designated zones – a rule that applies to Austrian citizens and foreigners.

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

Other regional property buying rules and exceptions

While the west of Austria has strict rules when it comes to foreigners buying property, it is the opposite in some places in the east.

For example, in Vienna, the key difference is that if a married couple is buying property and one spouse is an Austrian citizen, they do not have to go through the authorisation process to get a special permit.

But for couples in Vienna where both partners are international residents, or non-EU individuals, the authorisation process still applies.

And in Graz, there is no requirement for foreigners to gain the special permit to buy property. This means, as long as someone is a permanent resident in Graz (and they have the funds), they can buy property – no matter where they are from.