Austria to introduce nationwide rent brake
Chancellor Karl Nehammer, of the Austrian People's Party (ÖVP), says a nationwide rent brake will begin in 2024. Most - but not all - dwellings will fall under the cap.
Looking to move? Find your next rental apartment here.
With rents forecast to rise some 15 percent in the next year across Austria, Nehammer said the ÖVP-Green coalition government is bringing in a three-year rent brake limiting increases.
“The federal government has decided that we will not allow this,” Nehammer said of the forecasted increases at a press conference on Wednesday.
The government’s plans see the brake lasting for three years, from the beginning of 2024 to the end of 2026, and will limit annual increases to a maximum of five percent.
Old buildings are particularly affected, with the cap applying to almost anything built before 1953. In addition, it applies to any subsidized or social housing. Newer rental buildings may end up falling outside the cap, at least at first.
The government estimates that about 75 percent of all rental contracts in Austria will immediately fall under the cap’s legal purview, with politicians saying they plan to investigate further measures to cover the remaining 25 percent of leases.
In addition, landlords would only be allowed to increase the rent by this amount once a year.
Rents in Austria rose about 7.8 percent between July 2022 and July 2023. Without a brake though, prices were expected to increase further – with the government expecting the 15 percent rise – even with lower expected inflation next year.
The opposition Social Democrats (SPÖ), however, want the brake to go further by completely freezing rents until 2025, rather than the five percent annual increase the government plans to allow.
Depending on the size of the apartment, government experts expect the cap to save the average tenant somewhere between €500 and €1,500 over the next years.
READ ALSO: Renting in Austria: When can my landlord increase the rent and by how much?
Comments
See Also
With rents forecast to rise some 15 percent in the next year across Austria, Nehammer said the ÖVP-Green coalition government is bringing in a three-year rent brake limiting increases.
“The federal government has decided that we will not allow this,” Nehammer said of the forecasted increases at a press conference on Wednesday.
The government’s plans see the brake lasting for three years, from the beginning of 2024 to the end of 2026, and will limit annual increases to a maximum of five percent.
Old buildings are particularly affected, with the cap applying to almost anything built before 1953. In addition, it applies to any subsidized or social housing. Newer rental buildings may end up falling outside the cap, at least at first.
The government estimates that about 75 percent of all rental contracts in Austria will immediately fall under the cap’s legal purview, with politicians saying they plan to investigate further measures to cover the remaining 25 percent of leases.
In addition, landlords would only be allowed to increase the rent by this amount once a year.
Rents in Austria rose about 7.8 percent between July 2022 and July 2023. Without a brake though, prices were expected to increase further – with the government expecting the 15 percent rise – even with lower expected inflation next year.
The opposition Social Democrats (SPÖ), however, want the brake to go further by completely freezing rents until 2025, rather than the five percent annual increase the government plans to allow.
Depending on the size of the apartment, government experts expect the cap to save the average tenant somewhere between €500 and €1,500 over the next years.
READ ALSO: Renting in Austria: When can my landlord increase the rent and by how much?
Join the conversation in our comments section below. Share your own views and experience and if you have a question or suggestion for our journalists then email us at [email protected].
Please keep comments civil, constructive and on topic – and make sure to read our terms of use before getting involved.
Please log in here to leave a comment.