Austrian property prices continue steady decline throughout 2023
Austrian property prices have seen a steady, slight decline over the course of 2023, prompted by a number of factors, new figures show.
However, the market is divided into two segments, with second-hand properties seeing significant price decreases while newly built properties remain relatively expensive, as reported by Der Standard.
In recent years, residential property prices surged, increasing by around 23 percent in 2021 and 2022. However, this trend has reversed, and prices are now slightly falling. According to new data from the Austrian National Bank, property prices decreased by just under 0.4 percent between July and September 2023.
Raiffeisen analyst Matthias Reith predicts that property prices may experience an overall decline of approximately two percent in 2023, in nominal terms, the report added.
READ ALSO: Can foreigners buy property in Austria?
However, the price trend is not uniform across all segments of the real estate market. Second-hand properties have seen a significant nominal price drop, with a 6.9 percent decrease in Vienna and a 3.5 percent decrease in the rest of Austria. In contrast, newly built houses and apartments have become more expensive since the previous fall, with increases of 2.2 percent and 4.6 percent, respectively.
The effects of this price slump is reflected in data nationwide. According to Eurostat, 33 percent fewer Austrian residential properties changed hands in the first half of 2023, and this trend will continue in the future.
The reduced demand for older apartments can be attributed to higher heating costs and the need for renovations or heating system upgrades. Conversely, buyers of new-build apartments face higher construction costs due to the recent surge in building expenses. These newer properties also often have high energy efficiency ratings, which many prospective buyers are willing to pay a premium for.
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However, the market is divided into two segments, with second-hand properties seeing significant price decreases while newly built properties remain relatively expensive, as reported by Der Standard.
In recent years, residential property prices surged, increasing by around 23 percent in 2021 and 2022. However, this trend has reversed, and prices are now slightly falling. According to new data from the Austrian National Bank, property prices decreased by just under 0.4 percent between July and September 2023.
Raiffeisen analyst Matthias Reith predicts that property prices may experience an overall decline of approximately two percent in 2023, in nominal terms, the report added.
READ ALSO: Can foreigners buy property in Austria?
However, the price trend is not uniform across all segments of the real estate market. Second-hand properties have seen a significant nominal price drop, with a 6.9 percent decrease in Vienna and a 3.5 percent decrease in the rest of Austria. In contrast, newly built houses and apartments have become more expensive since the previous fall, with increases of 2.2 percent and 4.6 percent, respectively.
The effects of this price slump is reflected in data nationwide. According to Eurostat, 33 percent fewer Austrian residential properties changed hands in the first half of 2023, and this trend will continue in the future.
The reduced demand for older apartments can be attributed to higher heating costs and the need for renovations or heating system upgrades. Conversely, buyers of new-build apartments face higher construction costs due to the recent surge in building expenses. These newer properties also often have high energy efficiency ratings, which many prospective buyers are willing to pay a premium for.
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