Home Property in Austria
How to buy a house in Austria?
Here you will find the detailed information about real estate purchasing in Austria:
- the right way to choose the property and to effect the deal;
- property taxes and duties that should be paid;
- everything about home loans in Austria;
- home property management and renting;
- rental, commercial properties and related investment properties.
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According to law, real estate acquisition in Austria is allowed only to residents of the country, citizens of the Republic of Austria and citizens of the EU countries. This also refers to all new countries of the European Union (including Malta and Cyprus) and of the European Economic Area (Lichtenstein). A real estate purchase agreement in Austria requires an original document confirming citizenship of the EU member state or registration of a company in such country.
Non-EU nationals must obtain a special license prior to purchasing real estate in Austria. The Republic of Austria is composed of nine federal provinces with their own parliaments and governments, as well as local legislation, which might differ greatly. Therefore, the rules that strictly define the processes of real estate acquisition can vary depending on a specific region. In fact, in some regions a special license is required for all real estate buyers – even for Austrian citizens.
For example, purchasing real estate in the provinces of South Tirol, Vorarlberg and in some districts of Salzburg is practically impossible for non-residents based on severe restrictions. Meanwhile, it is much easier for a foreigner to buy an apartment in Vienna or Burgenland. Austrian government investigates every potential acquisition of real estate very thoroughly regarding it as an investment, which can influence economic growth in the region.
In order to buy real estate in Austria a foreigner must have lived in the country for at least 3 years before making a purchase, prove that Austria is the center of his or her interests and provide relevant recommendations. In this case, Vienna offers the quickest way to get a permission for purchasing real estate in Austria.
The procedure of real estate acquisition in Austria takes from two weeks to a month.
Every contract is examined individually. This procedure is usually administrated by a public notary; real estate purchase agreement is signed in his or her presence. Registration of real estate in Austria is also regulated by a notary. It is his or her responsibility to register the buyer of real estate as its new owner in the land register. In addition, a notary receives payment during a real estate deal.
When Austrian notary receives the documents confirming the ownership right on real estate in Austria, he or she then transfers money to vendor’s account and sends all documents relating to the piece of real estate to the buyer. It stands to mention that the notary is responsible for managing the funds on a special account of the buyer. Should the deal be cancelled by Austrian government (in very rare cases), the funds are returned to buyer’s account.
The most popular and expensive Austrian real estate is in Vienna. Prices for premium apartments here range from €15 000 to €18 000 per sq. m., and over €20 000 in the Old Town. Prices for new build apartments range from €2000 to €5000 per sq. m., reaching from €15 000 to €27 000 in the most prestigious places of the Austrian capital.
The average price on real estate in Vienna increases 5–8 % annually. As of January 2015, the average price on new build homes was around €3400 with rental yield being around 3 %. Since living space is limited, rental rates in Vienna are highly regulated.
A 150 sq. m. apartment in the Austrian capital costs about €500 000. Premium apartments and villas in Vienna are worth some €5–7 million. The most expensive apartmens in Vienna are located in the center, the 1st municipal district, where one square meter costs €11 219. The most affordable housing in the Austrian capital is located in the 15th municipal district at a price of €2848 per sq. m.
Let’s have a look at prices on Austrian real estate in other cities. A 50 sq. m. apartment in Graz costs around €150 000. Real estate in Linz, a city of northern Austria, with an area of 80 sq. m. is worth around €275 000. A 90 sq. m. estate on the outskirts of Graz costs €200 000, while a 80 sq. m. castle near Salzburg – some €400 000.
A small guesthouse in Salzburg with an area of 250 sq. m. can also be purchased for €400 000. A prestigious hotel in the capital is worth €6–7 million.
In a region to the west of Vienna, known as Lower Austria, a small house for rental income can be bought for €50 000. A local townhouse costs around €70–80 thousand, while a remarkable chalet on the shore of Lake Lunz am See – some €129 thousand. The only obstacle for an owner of real estate in Lower Austria is its predominantly German-speaking population.
Advantages of Austrian real estate:
- excellent environmental conditions;
- marvelous city architecture;
- beautiful sights of nature – mountains, lakes and forests;
- small amount of immigrants;
- high quality of life.
Disadvantages of Austrian real estate:
- high real estate prices;
- language requirements;
- complicated application process for citizenship.
There are several things to consider when buying real estate in Austria:
Purchasing real estate in Austria requires a special license, which foreigners cannot obtain in some regions.
The easiest way for a foreigner to get a permission for purchasing real estate is to apply for it in Vienna.
In order to buy real estate in Austria a foreigner must have lived in the country for at least 3 years before making a purchase, and prove that Austria is the center of his or her interests.
In order to get a permit for purchasing real estate in Austria, non-EU nationals must pay a charge of €1000.
Austrian law regulates all expenses related to real estate acquisition, including the real estate tax. The amount of payoffs depends on a specific federal province and varies between 10 % and 14 % of the cost of real property, including:
Starting April 1, 2012, the procedure of calculation and payment of income tax by private individuals has changed: if the difference between selling and purchase price is more than 25 %, the piece of real property is taxed.
Real estate purchased before April 1, 2012, is taxed at 3.5 %. In case there is a family connection between the parties, the tax amounts to 2 %.
Notary services or other legal fees, which are calculated using a special formula, make up 1–2.4 % of the total cost.
Real estate investment in Austria is taxed by the national land register at 1 % of the real property value.
Agency commission is defined by law and amounts to 3.6 % (subject to payment, when signing a real estate purchase agent’s agreement). archived version