Our Monthly property news updates
Austria takes Hungarian land law issue off EU agenda
Austria has withdrawn its criticisms of Hungary's new land laws
from an EU ministerial agenda, news that has been welcomed by Hungary's
The two countries have been in a dispute over changes to Hungarian land
law, which are due to go in into effect on 1 May when foreign farmers'
rights of use to Hungarian farmland will cease.
The change in legislation has been described as "unacceptable" by the
Austrian minister Andra Rupprechter as it affects Austrian farmers who
have paid in advance to use the land and fully complied with the
The Hungarian Parliament also on Tuesday approved a law that will make
it easier and more effective for Hungarian authorities to take action
against invalid ownership of farmland in the country. Austrian farmers
will also not be able to use old or new laws to legally claim ownership
of lands in Hungary.
It is not clear exactly why Austria has removed the issue from the EU
ministerial agenda, although Hungarian farm minister has described it as
a step in the right direction and said that the EU ministers' council
did not have the authority to discuss the matter.
Austria sees biggest increase in property prices in Europe
Property in Austria has seen the highest rate of price growth in
Europe since the Lehman brothers bank crashed, throwing the region and
other countries housing markets into an economic downturn.
The financial crash largely bypassed the property market in the country,
according to a recent report published by Knight Frank, a real estate
Whilst Austria saw a 34% rise in mainstream house prices since 2008,
Vienna saw an even bigger rise of 55%. Prices for luxury properties in
the city range between 15,000 Euros and 18,000 Euros per sq m.
The most prestigious properties in the first district of Vienna, an area
registered as a UNESCO World Heritage Site, can see prices as high as
20,000 Euros per sq m.
Most of the sales are to second home buyers from around the world, many
of whom are from Russia, Eastern Europe, the US, Germany and
Switzerland. Some interest has come from even further afield, with the
number of web searchers for Viennese homes by people based in Asia
increasing 11% in the first nine months of 2013 compared to the same
period in 2012.
International demand for properties in the capital has been driven up by
the cities reputation for being a safe and private place to live and
it's relative economic and social stability. The fact that Vienna has
also topped the quality of life rankings by consultancy firm Mercer for
four years has also helped to attract second home buyers to the region.
Austrian central bank downplays real estate bubble fears
The Austrian central bank has downplayed concerns over whether the
real estate bubble in Vienna and the rest of the country could shake
However the central bank said on Monday it will be monitoring the situation by creating a new fundamental price indicator.
Residential real estate in Austria increased 39% between 2007 and 2013,
the highest increase seen in the Eurozone. Vienna saw particular price
hikes with the top-end of the market attracting foreign buyers looking
for second homes.
About the risk of a housing bubble in the country, the Austrian central
bank said on Monday: "The risk to financial stability from increasing
real estate prices is gauged to be low.
Low interest rates from the European Central Bank have been pointed to
as one of the reasons for the price increases as it makes mortgages less
Germany is also experiencing rises in real estate prices but the central
bank Bundesbank has also said it doesn't present a risk. "It is very
unlikely that this will result in macroeconomic risks or dangers to
financial stability," the bank said in October, although highlighting
that house price corrections in cases of over evaluation may lead to
"perceptible" losses in wealth for some.
Largest luxury chalet in Kitzbühel goes on sale
By Maddy French
A thirteen bed luxury chalet in the most expensive ski resort in Austria
has been put up for sale for 35 million Euros by agency Savills Alpine
The home in the exclusive Kitzbühel in Tyrol includes a 16-seater
cinema, a gym, sauna, spa and temperature controlled wine cellar. It's
believed to be the largest private home in the resort.
The sale comes at a time when the Austrian property market remains the
strongest in Europe, seeing the highest rate of price growth on the
continent since the Lehman brothers bank crashed in 2008. Property in
the Alps has been particularly successful, with prices rising 34.7
percent since 2008. This compares to 26 percent in Switzerland and just
0.9 percent in France.
Kitzbühel is located one hour from Munich and ninety minutes from
Salzburg and Innsbruck airports. It's also home to the iconic two mile
downhill skill slope on the World Cup circuit, Hahnenkamm, which nearly
all the rooms in the luxury chalet look over.
Dec - Second home renting problems
The problems relating to holiday renting of apartments are starting to become more of a problem, particularly in Salzburgland area. Recently one of our Austrian colleagues related that, whilst selling a property,..they were asked by the British buyer if there were problems with second homes.
The agents lawyer's checked and found that there had indeed been problems and this was in Salzburg area. The apartment owner wantyed to rent his apartment for holidays, for which it was designated as Secondary residence..ie: holiday home. It is European law that no house management company or local Gemeinde can change the designation of a property.
But the other permanent owners in the building were not happy, so they went to court in Salzburg and the ruling was in favour of the permanent residents!!! This flies in the face of European law, and seems to be a new under the table method to get holiday homes redesignated. We will be speaking with other colleagues in various local regions and get them to check also the attitude for second homes.
In the meantime, we would advise buyers to check thoroughly the designation of an intended property purchase and more importantly ask the House management companies for their opinion of the other residents in the building....you will save yourself a lot of heartache and loss on investment!! The upcoming areas of Austria to the east do not seem to have this problem...possibly because these areas are not as rich as Salzburg and Tirol, so rely more on income from overseas investors in property.
Nov - Important update Property Tax
This past year, there have been important tax changes in Austria for all Property owners, Austrian and other nationalities. These changes are starting to take effect, now that second home owners are putting property on the market.
The new rules affect every overseas property owner and second home owner. The new tax is 25% flat rate on the property capital gain at the time of selling. So, a... 20,000 euro profit means 5,000 euro to the tax man.
The system for the taxation is via the notar at the time of selling. The Notar has to arrange to pay the 3.5% government tax for the Buyer. He now also has to make a declaration to the Tax authorities for the potential profit on the sale. You can of course offset a lot of the costs that were involved when you purchased and also all renovations etc. It means that one now needs to keep records of all costs for a property during ownership and to give a lis tof the costs to the Notar when selling. He is then able to deduct the costs that would be allowed for deduction and give the tax office a figure of tax to be paid.
For the UK and other countries in Europe, there are double taxation treaties..so the seller. can maybe offset this tax against their own tax bill in their country of residence.
It is early days yet and we are sure that more information and any potential problems will come out sooner or later.
The property market in Austria has slowed as in other areas of Europe, but the local market has remained consistant. There are many new individual houses being built, but not large blocks of housing.
The apartment market remains strong, as the demand from workers moving jobs around austria continues to stimulate demand.
There are local property price bubbles around the major lakes...which is forcing buyers to look further away from the lake areas.
Popular region at this time is Carinthia in Austria's southern alps on the border with Italy. The main demand coming from Italians and Hungarian buyers.
Houses on edge of the city much sought after
A new study carried out by market researchers in Austria has
revealed most young people dream of owning heir own house on the edge of
The study carried out by GfK on behalf of Raiffeisen Bausparkasse asked
1,325 young people aged between 18 and 39 about their current and ideal
According to the study the majority dream of owning their own house in the countryside but near to a major city.
68 per cent of those asked want to buy their own house. Currently 46 per
cent of those asked are living in a village, 27 per cent in a big city,
15 per cent in a mid sized city and 12 per cent in a small town.
Around one quarter of hose asked want to live in a completely rural
environment, 27 per cent want to live in a village which is near to a
mid or large size city and 21 per cent want to live in a big city but
prefer not to be right in the centre but on the outskirts.
Around half of those asked currently live in their own personally owned
accommodation - 29 per cent of those in their family home or with their
parents or relatives.
A quarter live in rented accommodation, 13 per cent in a housing
association apartment, ten per cent in their own apartment, two per cent
in a rented house and five per cent in another apartment such as a
79 per cent of those asked said they were very happy with their current living situation
Only about ten per cent said they were unhappy with their living situation - most of these were renters.
By middle age 68 per cent hope to have their own house, 15 per cent
their own apartment, 7 per cent want to live in a rented apartment, 2
per cent in a rented house and one per cent in another form of
People are becoming more mobile - 39 per cent of those asked said they
were prepared to move for private and business reasons. In 2005 it was
just 27 per cent.
In the under thirties category one in two people would be prepared to relocate.
Tenants should check running costs
Landlords in Vienna who try charging tenants extras in fees could face legal proceedings.
By the end of June, landlords were told they had to produce a detailed
operating cost statement to ensure no hidden extras had been included.
Legal expert Christian Boschek from the Viennese Chamber of Labour said:
"It’s possible that some try to cheat by sneaking things in.
"Tradesmen invoices in connection with repairs in the house, for
example. If the landlord engages a painter or a installer, these are
costs that have nothing to do with operating costs."
Lawyers’ fees and operating charges are also not supposed to be counted
in the operating costs. If these do appear in the statement delivered by
the landlord, tenants can request that the bill be put right.
If this fails, it is possible to take action through the conciliation
body of the Viennese department for housing issues (MA 50). The body
will then decide whether the bill is correct or not and to what extent
it has to be corrected.
Boschek said: "Any mistakes have to be declared. If the landlord does
not correct the operating costs statement, legal procedures are
Statement can be challenged up to three years after receipt.
Salzburg property prices increase further
The real estate prices have remained high in Salzburg. The rents increased by almost 11 percent in 2012. This is apparently due to the scarce supply.
Houses and owner-occupied flats have been a popular financial investment. As many investors lost high amounts on the stock markets in 2008 and 2009, a part of the investors changed to the allegedly safe real estate market.
This led to increasing prices of houses and owner-occupied flats. As the supply in Salzburg is scarce, the rents have increased by 10.9 percent. In contrast, the prices increased by not even half in Linz and decreased in Eisenstadt.
In total, the upward trend of real estate prices has slowed down. A current price comparison of the Chamber of Commerce shows that the increase in prices will slow down in general.
Real Estate Trustees demand an extensive reform of rental law from the National Council. However, they state that this reform needs to be well thought out and is not compatible for the election campaign.
5,500 new millionaires in Austria
2012 has been a successful year for the wealthy in Austria. The numbers of Austrian millionaires has increased by 5,500 people (10%) to 77,600 people. They own a third of the total private assets.
In total, Austrian millionaires own assets of 245 billion Euros. Every Austrian millionaire owns 3.15 million Euros on average.
Family Porsche/Piech are on top of the list of the super-rich with 40.9 billion Euros. This was shown by the most recent asset report of the investment house Valluga AG from Liechtenstein.
"This record result is mainly thanks to the booming capital markets and the strong real estate market", the authors of the study stated.
The study only considers the financial assets without real estates that are not used. Austrian billionaires own more than a third of the total Austrian private assets (33.4%).
The highest density of millionaires is in Vienna, with 1,130 millionaires per 100,000 residents. This is followed by Lower Austria and Salzburg. Burgenland is at the bottom of the list with 590 millionaires per 100,000 residents.
The number of millionaires in Vienna has increased by nine percent to 19,500 in 2012. This was followed by Lower Austria (17,200), Upper Austria (12,500) and Styria (9,600).
Dietrich Mateschitz is in second place with assets of 7.5 billion Euros. This is followed by Family Flick (6.3 billion Euros), Novomatic boss Johann Graf (4.5 billion Euros), real estate tycoon Karl Wlaschek (4.2 billion Euros), Heidemarie Horten (3.2 billion Euros), Family Swarovski (2.6 billion Euros), entrepreneur Wolfgang Leitner (2 billion Euros), Frank Stronach (1.9 billion Euros) and the siblings Patricia, Emil Alexander and Marie-Rose Kahane (1.8 billion Euros).
The increase of the super-rich is, however, no Austrian phenomenon. The number of millionaires increased in the German-speaking region (Germany, Austria, Switzerland) to 1.13 million people in 2012.
Parndorf centre invests in expansion plans
Well,... as in the rest of Europe, property purchases have slowed. Local agents report little new properties becoming available for sale. The feeling is that the insecurity being felt by all of Europe is to blame...but on the otherside of the coin, it seems that people are extending their properties as opposed to selling! The other good news is from the commercial sector...there are projects in hand for new shopping malls and centres. The popular designer outlet in Parndorf, Burgenland, is going to get bigger: from now until 2016, the outlet will be extended by 3,600 m2, with 30 new shops and restaurants being built. However, this will also cost the company a lot.
"Do not ask me about a certain date, this depends on the authority approvals", said the manager of the "Region Nordeuropa" Thomas Immelmann at the annual press conference in Vienna yesterday (Thurs).
The environmental impact assessment was filed a short time ago. The operator McArthurClen has invested a "large amount in the tens of millions" into the expansion of the outlet in Parndorf.
McArthurGlen operates a total of 21 outlet centres and Parndorf is the biggest with a sales area of 42,000 m2. The Austrian market is saturated in regards to outlet centres (Parndorf and Salzburg).
The revenue of Parndorf has increased by nine percent in the business year 2012/2013. The number of visitors has increased to 4.2 million people.
Due to the location in Burgenland, which is close to the borders to Slovakia and Hungary, many customers from these countries come to Parndorf. The number of customers from Non-European countries such as Russia, the Ukraine, China, Korea, the US etc. is also increasing.
Mr Immelmann said that the firm has representatives in these countries who work together with travel agencies. Almost 250 travel groups with 9,600 people visited Parndorf last year.
The firm neither wants to open on Sundays nor plans to enter the market on the Internet. The next late-night shopping will take place on 22 August 2013.
Austrian regulations changing for overseas buyers
It seems that in some regions of Austria, the regulations for second homes are becoming much tougher. This is having an effect on the property market.
The local governments in some regions are making it more difficult for foreign buyers in particular. This is understandable for buyers from outside the EU, but some regions are causing difficulties for other European nationals. This is causing concern for buyers and the property market is starting to reflect this.
Interest in property in the popular Salzkammergut region has fallen over the past 6 months, with buyers waiting to see what will happen this coming spring/summer.
One of the most welcoming regions for other EU nationals to buy, is in the Waldviertal. They are actively promoting their area for people to invest for either permanent living or holiday homes. This has had the effect of greater interest in this region for buyers.
The Waldviertal is in Lower Austria the region between Linz and Vienna.
Austrian land being built on at an alarming rate
An average of 20 hectares of agricultural and green land is built on each day in Austria – that's the equivalent surface of an average cultivated farm per day. Experts are asking for a change in the planning law and are calling for more cooperation between municipalities in construction projects.
The president of the agricultural chamber Gerhard Wlodlowski said recently that it is almost exclusively high-quality agricultural lands that end up as building projects.
Compared to European statistics, the building on agricultural land in Austria is higher than average. In the past 50 years, the agricultural land available fell by 300,000 hectares and meadowland went back 570,000 hectares – the equivalent of a city the size of Salzburg. At the same time, the number of abandoned industries and commercial premises shot up. These could cover one third of the space needed each year.
Only a third of the mountain land in Austria is suitable as a settling place – 15 percent of which is already used. Wlodowski said: "Everyday around 11 hectares of agricultural land is used for transport, industry, economy and housing. If one counts the recreational and mining areas, that is over 20 hectares a day."
The increasing building has negative impact on the environment and climate. Meadows and agricultural land are responsible for various functions, such as regulating the ecosystem. These are also the living space for animals and plants act as a protective measure in holding back or saving rain water. They take part in conserving biodiversity and storing carbon. Last but not least, they are a living and relaxation space for humans.
With every modification to the CO2-rich soils, the climate – and the global warming – is accelerated and the risks of storms increases. Chairman of the Austrian Hagel insurance company (Hagelversicherung) said the consumption of the land urgently needs to slow down.
Gerling Weber from the institute for spatial planning at the University of Natural Resources and Life Sciences in Vienna (BOKU) asked on public radio that planning laws are changed. One should build sparingly, instead of always building on new meadowland. He said: "First of all, always look at what is available. And then, go for the meadowland. At the moment, it's the opposite."
He added that political motives often prevent efficient construction. He said: "The bigger the competition is between the communities, the more yielding they become with regards to the offering of such plots of land – which absolutely does not conform with the ground sparing regulations."
President of the eco-social forum Stephan Pernkopf said: "Active space policies is not only important because of ecological factors." The growing urban sprawl leads to rising costs. Compact housing structures are, on the contrary, a great relief for budgets.
Environment minister Nikolaus Berlakovich (ÖVP) doesn't believe the municipality policy is failing. There the belief that usage of ground should be slowed-down and planning laws are already being modified. He said: "There are already positive examples in all regions of planning projects whereby resources and energy consumption are reduced.
Berlakovich asks fore more cooperation between the communities to spare meadowland. He said: "the land must be worked on together, efficiently used – in the housing for individuals but also in creating new economical zones."
Holiday homes and secondary residency
We have had requests to try and clarify the holiday home usage regulations. As local gemeindamt are asking owners to state whether main or secondary residence. Each area of Austria tends to have an interpretation...but here is a snippet from EU law:
Concerning real estate transactions between EU- and EWR-Citizens in Austria there is a valid supremacy of community law against the internal laws since 2000.
The purchase of real estate takes place in execution of the laws according to the basic liberties of the residence law and the freedom of capital transactions stipulated in the EG contract and the EWR agreement.
Mayor and the community of the real estate are strictly bounded to the EU law and therefore an eventual prohibition of use, limitation of use and compulsion of use are not permitted.
There is no commitment to a formal establishment of residence in the community as according to EU law this is not prescribed for the first, second and third residence.
Austrian Chamber of Commerce plans International English School in Salzburg
The Austrian Chamber of Commerce and the regional educational board are planning to build an international school in Salzburg where students will be taught in English.
There are now concrete plans to open the school in 2016. "Salzburg will thus attract even more international qualified employees with children." says Manfred Pammer, Deputy Managing Director of the Chamber.
"The school will provide education in English for 10 to 19-year-olds. Qualified employees are more likely to work abroad when their children’s best possible education is ensured."
Up to this point, Salzburg has not been offering the opportunity of education in English from the age of 10 to 19. Herbert Gimpl, president of the regional educational board, says that the inhabitants of Salzburg will also benefit from an international school.
The Chamber of Commerce plans to take over the maintenance of the international school on the premises of the tourism school Salzburg-Klessheim. It has not been decided yet whether the school will be built on a different venue though.
Famous Hotel Panhans sold for 5 milllion Euro
One of Austria's best known hotels – the Hotel Panhans with its spectacular panorama view over the Semmering region - has been sold for five million Euros.
The hotel which went into liquidation has now been saved after a long drawn out insolvency case.
The Mostviertler company IBS is said to have transferred five million Euro to the liquidator Gernot Hain and the insolvency proceedings have been closed by the court.
IBS Umwelt- und Verkehrstechnik GmbH an architectural and engineering company owned by Thomas Schellenbacher (75 per cent share) and Ukrainian Igor Palytsia (25 per cent share) have bought 92 per cent of the shares in the hotel.
The traditional hotel reportedly had debts of around 3 1/2 million euros which are owed to two banks and various other creditors.
So, will it become luxury apartments or an updated hotel...The hotel is expected to be renovated and to be run in the future as a hotel. watch this space.
According to information available the firm Pöchlarner IBS Umwelt- und Verkehrstechnik GmbH, and architects and engineers office has a turnover of around 3,000,000 euros a year according to figures for 2010.
Recession forces Manor house owners to sell up.
Austria's manor house and chateux owners are being forced to sell up, saying they can no longer afford to pay the running costs.
And estate agents dealing with the high-class properties say they can't remember a time when so many multi-million euro properties were on the market - but the only buyers that seem to be interested and have the money are from Russia.
In Lower Austria alone there are reportedly 15 manors up for sale and current statistics show they are likely to remain on the market for years rather than months before finding a buyer. In Lower Austria it includes Schloss Trautmannsdorf, Ebreichsdorf, Hohenau, Kirchstetten and Walpersdorf.
Those who have put their properties on the market include Maria Antonia Schramek who inherited her manor house Schloss Payerbach from her father and said although it had many fond memories she could no longer afford to keep it.
The property is on sale for 2.6 million euros and she hopes that it might be sold to an artist who would take up residence there .
But she is one of the few people prepared to admit that she is selling up for financial reasons – many Austrians don't even want to publicly advertise their properties because of the embarrassment associated with having to give them up and they attempt to sell them in private circles – mostly without success.
Bärbel Langer is another one that recently sold her property Schloss Ebenfurth which she purchased and together with her daughter wanted to renovate – but was forced to sell after she was unable to meet our obligations. It now belongs to a Serbian popstar.
Energy efficiency rules now in force for property
A new law has come into force across Austria making it compulsory for properties to include information about their energy efficiency as part of a plan to cut down on CO2 gas emissions.
The EU wide initiative means that properties which have not been thermally insulated or have inefficient heating end up with a poorer rating and should therefore be negatively rated when being sold or rented.
The idea is to offer incentives to property owners to make sure that they make their buildings energy efficient by forcing them to get an "Energieausweis" certificate.
Failure to do so in a property coming onto the market from now on will result in fines of up to 1,450 euros.
The certificates can be obtained from officially approved suppliers found here http://www.energieausweis.at.
Georg Thor from the Salzburg-based energy advice office said that it will mean in future it is easier to evaluate the real worth of property.
But certificates are not without cost – with firms charging up to 500 euros per certificate.
Gerald Hubner from the Real estate Association said: "A proper certificate will mean a saving in costs and problems at a later date. Property owners need to know what sort of problems there are with their property and potential buyers or renters will want to save money with a proper certificate giving them an indication of the running costs of a location."
Vienna wants clarity over unfair flat rental contracts
Vienna is demanding changes in the rules governing rental contracts for property which have become incredibly complicated with the various changes in recent years.
They say it is now no longer possible to have the overview, according to the man responsible for housing in Vienna, Wohnbaustadtrat Michael Ludwig (SPÖ).
He said there needs to be more transparency in the way properties are rented.
At the moment there are 2 completely different forms of rental contract. One is the old category rental contract (Kategoriemieten) and the other is the new location worth contract (Richtwertmieten).
Anybody who rents a flat is now automatically in the Richtwertmietzins category but those who rented under the old contracts still have those rules applying.
The problem is that even the new contract is difficult to control – for example the law controls how much is charged per square metre but there are various extra charges that can be added such as the distance from public transport and how noisy the immediate neighbourhood is.
That means for example that although a flat owner might demand extra for the fact that the location is peaceful – that might also mean it miles away from public transport.
But on the other hand allowing more because of the close proximity of public transport was a category that applied to almost every flat in the first district where public transport was everywhere.
The city wants the national government to change the law accordingly to make it fairer and in particular the way the rental amount possible to be charged is evaluated.
They said for example that people renting flats almost always took advantage of the opportunities to charge for extras such as the nearness of public transport, but failed to deduct for the disadvantages of their property such as not having a bath.
New retail chain shop opens
￼A new fashion retail chain is in Austria. The extremely popular Primark brand, opened on 27 September 2012 in Innsbruck SILLPARK... its first store in Austria. We hope there will be more.
Primark has more than 230 stores in Ireland, England, the Netherlands, Spain, Germany, Portugal and Belgium.
Austria now has appeared on the expansion map of the chain store and can only benefit from the new development. Primark is in the lower price segment, but with a high quality promise. It has waived traditional advertising and is therefore only in highly used locations with lots of footfall. It is medium to large sales areas that are of interest to the company.
Problems with housebuilding financing.
People building houses and renovating properties in Austria claim financing is the biggest problem.
The Linz based Market-Institute carried out a study of property builders and renovators in Austria and found that 10 per cent of those asked would advise against carrying out building work altogether!.
The largest problem according to those asked was financing. 37 per cent of people building houses and 24 per cent of those renovating in Austria have said they had problems with financing their build and claim their project was much more expensive than originally planned.
This is a considerably larger number than in 2009 when only 25 per cent and 23 per cent of people claimed there were problems with the financing.
In addition 23 per cent of people who have built or are building properties claim to have problems with appointments, and late and incorrect deliveries.
17 per cent of those asked said they had problems with workers, the build quality and errors. The same number of people complained about the lack of time, the large amount of work and their itinerary.
Only seven per cent of those asked said they were plagued by unforeseen complications. Just two per cent complained of stress and problems between people involved.
81 per cent of those who have already completed their building project advise all those considering a building project to consider the financing very carefully before beginning.
75 per cent of those asked advise getting price comparisons of different offers before beginning.
69 per cent would recommend to people they know, who want to build a house, to explore energy saving possibilities to try and keep costs as low as possible.
Just 63 per cent of those asked recommend exploring grant and tax opportunities.
But 10 per cent of those asked said they would totally recommend people to stay away from building a property as they had too many problems.
Property prices rise in Austria
The prices for houses and apartments in Austria have risen once again in the first half of 2012 compared to 2011 prices.
Vienna saw significant rises in certain parts of the city and areas of Lower Austria such as St Pölten and Krems also saw rises.
There are also significant differences in prices in different provinces for example property costs on average 3,000 Euro per square metre in Mödling but only 590 Euro per square metre in Waidhofen an der Thaya in Lower Austria.
Property expert Alexander Ertler said: "The fear over losing money through inflation and mistrust in the financial markets is encouraging increasing numbers of Austrians to invest and try and find security in the property market."
There is an increasing demands for houses on the outskirts of Vienna. For the same amount of money you can get considerably more living space than in a property in the city centre.
This is impacting on the price, for example houses in Korneuburg have increased in price by an average of 17 per cent. Apartments in Wiener Neustadt have increased in some parts by 25 per cent.
In Vienna's Mariahilf district the average price per square metre is 4100 Euro - this is an increase of 16 per cent on last year.
In comparison the cost of rental property only increased relatively moderately in the first half of the year on average by 1.6 per cent.
Ryan Air connection to stay
The Ryanair connection between London and Linz in Upper Austria is not to be scrapped, it has been announced.
In the new winter flight plan announced by Ryanair there will be collections between Linz and London on Tuesday, Thursday and Saturday.
Linz Airport is suffering form a reduction in flights. German airline Air Berlin announced that it was cutting the number of flights to Linz.
Between December 24th and January 2nd the Lufthansa route between Frankfurt and Linz has also been cancelled.
At the start of August the management of Linz Airport held a meeting where it was agreed they were going to attempt a new marketing concept and work with airlines to come to new arrangements.
Airport Director Gerhard Kunesch said the victory to keep the Ryanair route was a "significant victory".
The new Ryanair flights can be booked as of now.
It is hoped by next summer that Air Berlin flights could be reinstated but that is dependent on the economic outlook of the airline.
Find a builder service helps rule out the cowboys!
Finding a decent builder or contractor can be hard enough - but for a foreigner in Austria it can be a daunting task.
But a new service tested recently by the Austrian Times offers a free way to get professional quotes from recommended professionals - eliminating the cowboys in the process.
The new free bidding website supports users in finding the cheapest and most reliable contractor for work around a property.
The Austrian platform profi-book.at that went online this spring, aims at joining customers with the most suitable service companies and professionals for domestic jobs and contract work.
Founder and CEO Georg Tanzer, 36, said: "No matter if you want your garden fence repaired or need advice for the planning of a natural pond or if you want a thorough, professional cleaning of your property with including floors and windows, you’ll find a professional for almost every job on our page."
Registration on profi-book.at is free for potential customers as well as for companies offering their services. Customers benefit from the possibility to start free biddings to receive proposals from different companies and being able to choose the most suitable contractor according to price and earlier customer’s ratings.
Focussing on service quality and reliability, profi-book.at won't allow offers by non registered professionals, (cowboy workers) while regular companies benefit by getting more jobs thanks to the free exposure, the online rating system, and a regular voting for the company of the month.
While profi-book.at is already cooperating with banks, insurance companies and phone companies, Georg Tanzer wants to intensify these cooperations. He said: "One of our aims is to create a win-win situation for profi-book customers as well as for the cooperation partners."
Contractors have the option to pay a monthly fee of 16 Euros to boost their presence on the site that generates revenue by getting a share of each successful contract between a customer and a contractor.
The company behind profi-book is located in Oberhausen, Lower Austria, and is in its present start-up phase concentrating on professionals and customers from the eastern half of Austria but coverage of all of Austria is planned for the end of 2012.
Company spokeswoman Sonja Sagan said:" Right now about 200 professionals and contractors are registered at profi-book.at. We are aiming for 500 registered professionals and a volume of orders worth 250,000 Euros by the end of 2012."
At the moment it's in German but will soon be adding an English version.
British firm to build Salzburg hotel complex
A major hotel village is to be added to the infrastructure of the tiny Lungau village of St. Margarethen in Salzburg province.
A British investor is planning to build a 360 bed hotel by the Aineck ski lift station down in the valley.
The approval for the project has already been won and building work will begin this year. The new project will increase the number of beds for visitors in the village by 50 per cent.
It currently has 750 beds – with the new complex it will reach 1,100. That is also a major boost to local tourism – bringing almost 80 new jobs, according to mayor Gerd Brand (SPÖ).
He said: “It is a constant aim to generate jobs here in the Lungau, exactly as we have here.” The Lungau will also benefit during the building stage of the 35 million euro project, he said.
Hallstatt makes peace with Chinese copycat
Austrian residents in the picture postcard Alpine village of Hallstatt are to sign a deal with a Chinese carbon copy village which officially opens on June 2.
Residents of Hallstatt in Austria were furious when their village was copied and rebuilt in China but now a legal challenge over the copyright breach has been dropped, and instead a delegation including Halstatt mayor Alexander Scheutz is to travel to China to sign the friendship treaty between the two.
Scheutz said locals had decided that the decision by the Chinese to create a copy was in fact a compliment and can only help to further spread the fame of his own village of 900 residents.
Never afraid to ‘borrow’ or imitate, Chinese planners were accused of making the ultimate counterfeit with a settlement copied wholesale for the benefit of wealthy industrialists and located just an hour or so by chauffeur-driven limousine from their grim factories in in Boluo in Guangdong province.
News of the plans for a fake version of the idyllic lakeside village generated a mixture of astonishment, amusement and finally threats of a legal challenge when it was revealed that ‘spies’ from a Chinese developer had been secretly preparing detailed blueprints on furtive European trips, posing as tourists.
No expense was spared on the project. The original buildings were copied and reproduced with startling precision by the China Mine Metal Group. It includes Hallstatt’s 1860 Protestant Christuskirche (Church of our Lord) at the heart of the town. But the church will not be used to worship – it's a restaurant and concert hall.
Horse-drawn carriages and flocks of white doves have even been imported to lend authenticity to the project where a new villa here built in the style of a 300-year-old lakeside home is being offered at between 200,000 and 500,000, GBP, much higher than the real thing in Austria.
Some things don't measure up. The fake lake, for instance, is not just muddy, it is 50 times smaller than the original, a stagnant shallow pool. Then Chinese Halstatt lacks the two-mile-high snowy mountains that surround the real thing, and instead is ringed by parched yellow hills, a few hundred feet above sea level.
And while the 800 residents of the real Hallstatt breathe pristine mountain air, China’s ‘Alpine’ residents will gaze out only as far as the smog allows across the nation’s black industrial heartland. Pollution is chokingly high in Guangdong province, known as the workshop of the world, causing sickness in almost half the residents.
Promotional literature claims: ‘You can go to Viennese cake shops, a beer house and a romantic Austrian-style square,and there will be a famous international school and kindergartens so children can have a wonderful childhood and get the best education.’ The facilities will include a mountain-top swimming pool, the region’s only mountain sports club, and restaurants serving the best of European cuisine.
There are some geographically improbable extras, too. Hallstatt, China, will include a replica of the street where Mozart was born, Getreidegasse, complete with a Mozart library and a period ironmonger. Getreidegasse is actually in Salzburg. The neighbouring street is named after Vienna’s Belvedere Palace, 200 miles from the real Hallstatt, although the developers have stopped short of trying to reproduce the 18th Century castle.
Wealthy Chinese are the world’s biggest buyers of fine French wines, and a taste for European culture is seen as a mark of sophistication. Luxury homes are often modelled on French chateaux while historic neighbourhoods in China’s own cities are bulldozed to make way for glitzy apartment blocks and shopping malls. China might have thousands of years of history and culture, but such things don’t seem to count.
Because the original is a UNESCO world cultural heritage site locals in Austria had announced plans to take legal action over the copy – but they have now decided that he the Chinese project is actually good advertising - and an honour.
The original Hallstatt’s website even now carries a motto: ‘Hallstatt – the original. Photographed a million times. Copied once.’
Mayor Scheutz said: "We only just got the news that the other Hallstatt is almost finished and we are a bit surprised that they've done it so quickly. They haven't really been keeping us informed about their plans but the feeling here now is that it is an honour that they have done this.
"We contacted the Chinese developer and now we have been invited to the official opening will take place on 2 June. They also asked if I could bring a traditional Austrian band with me and I'm going to bring the local Salinenmusikkapelle Hallstatt band with me, complete with lederhosen."
At the same time the Mayor plans to sign the friendship treaty with the Chinese recognising their twin origins.
June - update
Austrian economy recovers, says OECD
The Austrian economy will manage to grow by nearly one per cent this year, according to the Organisation for Economic Co-operation and Development (OECD). This is good news for the property market and those considering where in Europe to invest in a property.
The Paris-based institution announced that the small alpine state’s economy had chances to do 0.8 per cent better in 2012 than in 2011 before achieving an improvement of 1.6 per cent in 2013.
OECD analysts warned that the economy in some countries in Europe would not manage to recover in the foreseeable future due to exaggerated austerity measures. Francois Hollande, the new president of France, might feel strengthened by this statement. The left-winger emphasised the importance of growth aspects in upcoming EU agreements – a point of view which contradicts ÖVP Finance Minister Maria Fekter’s stance. She labelled Hollande’s visions as "nonsense" in a recent interview.
The OECD’s economic forecast follows predictions by the European Commission (EC) which warn from a decrease of the average GDP in the Eurozone of 0.3 per cent this year compared to 2011. The EC said the Austrian GDP would grow by 0.8 per cent at the same time. Fekter announced that an improvement of 1.2 per cent was possible in her opinion. ÖVP Economy Minister Reinhold Mitterlehner predicted the domestic economy to do "around one per cent" better in 2012 than in 2011.
The Austrian Institute for Economic Research (WIFO) said in its most recent forecast that the Austrian economy will increase by 0.4 per cent from 2011 to 2012. The institute did not correct its prediction ever since issuing it in February – despite positive indicators for Austrian firms which are strongly engaged in export.
Austrian National Bank (OeNB) Governor Ewald Nowotny announced yesterday the bank had plans to alter its forecast for the Austrian economy. The OeNB recently said that the Austrian GDP will edge up by 0.7 per cent from 2011 to this year. Nowotny explained that he saw good chances for a growth rate of one per cent.
Austrian Property even cheaper for the UK buyer
With Sterling sitting around the 1.20 - 121, Euro property prices in Austria are even better value. Couple this with an Austrian mortgage, currently around 2.75%. then you have a good formular for butying in Austria
Austrian know-how helps UK House Builders
With temperatures of minus 20 degrees and more in winter and snow that lies on the ground for months at a time compared to temperatures of over 40 degrees in summer Austrian house builders know a lot about extremes.
Little wonder then that they are world leaders in the passive house - or Passivhaus in German - that refers to the standard for energy efficiency in a building, reducing its ecological footprint. The result is an ultra-low energy building that requires little energy for space heating or cooling.
And that knowledge and experience that the Austrians have gathered over the years is now offering opportunities for Austrian companies abroad – especially in the United Kingdom which is admittedly a "late starter" when it comes to such sustainable building.
But According to the Austrian foreign trade centre in London it is now making impressive efforts to catch up, which points out that the UK’s climate targets are very ambitious and demand a radical change of thinking. The mindset, not only of the population in general, but also of the building industry has changed and the impact of this exciting process, which only started a few years ago, is already beginning to show.
The word "Passivhaus", previously a completely unknown term, is already beginning to appear in English usage. The UK "Passivhaus Trust" is an umbrella organisation for building professionals with a specific interest in Passivhaus design and although it was only founded a year and a half ago it already has 150 members – the Austrian foreign trade centre in London is one of the founding members.
Indeed, it seems that Passivhaus design has certainly caught the UK’s attention as it is being successfully lobbied in Parliament to introduce the "Passivhaus standard" into English building regulations. In any case, from 2016, all buildings in England and Wales will be Co2 neutral, i.e. very energy efficient and built sustainably. An even bigger market will arise therefore for the subsequent thermal insulation of old buildings.
Austria is seen as a model example for sustainable building and industry professionals listen intently to the achievements of Ursula Schneider, POS architect from Vienna, and about the experiences and developments in Austria.
As a country, at Ecobuild in London, the leading trade fair for sustainable building, Austria had the biggest presence with 500 square metres of exhibition space and 28 exhibiting companies on one group stand. A further six Austrian companies took part independently. From solar energy solutions, bio-mass heating, heating pumps, windows, the Tirol wood companies and pre-fabricated houses, the "Made in Austria" brand dominated with a strong presence.
There was also a particularly special feature on the foreign trade centre’s group stand that caused much interest this year. The stand featured a "Passivhaus Kaffeehaus", a full scale model of an actual Passivhaus with integrated products, provided by the Austrian exhibitors. During the fair the Austrian Passivhaus was used as the venue for a very special event. The UK Passivhaus Trust invited its members into the Austrian Passivhaus and Prof Wolfgang Faist, the "Godfather of Passivhaus", who teaches at Innsbruck University, launched the first UK Passivhaus Awards.
The Ecobuild trade fair has grown in recent years from being a small event to an international marketplace for sustainable building with 1,500 exhibitors and 60,000 visitors. "This development underlines the positive prospects for market opportunities in this industry," explains Georg Karabaczek, The Austrian Trade Commissioner in London, "the British market offers excellent opportunities for top-quality Austrian products and solutions."
Salzburg property prices on the increase
The prices of apartments in the city of Salzburg saw a further increase in 2011. The average rental stands at 13 Euros per square metre a figure which, the Salzburg Chamber of Labour argues, is not economically viable for those living on a normal salary.
The Chamber of Labour spoke out on Friday concerning the problem of rising property prices in the city of Salzburg which have, they argue, created a harsh and inaccessible buyer’s market. Experts have noted the regular changes in newspaper property announcements and on websites.
Once the barrier of 13 Euros per square metre is crossed, less will be paid for old houses and more must be spent on buying new apartments. According to the head of the Chamber of Labour Siegfried Pichler, the reason for the increase is the financial crisis.
Pichler said, "In this financial crisis more money is being invested in property which could be responsible for the increase in prices and in rent. As a consequence employees and people are seriously concerned in this country. The prices mean that a 70 square metre flat costs over 900 Euros in rent and operating costs. That is just not affordable. Some 100,000 people in this state earn less than 1,000 Euros per month."
In the countryside, the average rent is not significantly lower at 11 Euros per square metre with increases expected here also. Despite these increases eperts from the Chamber for Labour, do not believe that rents will be frozen this year.
The increase in Sterling gives new interest in Austria property
The slow climb of sterling against the Euro has given new impetus to investing in Austrian property. In the last 6 months there have been 20 sales in our local village!! Most are from the Uk, but many are also from the countries suffering in the debt crisis.
All the signs are that Sterling will stay around the 1.20 euro to the Pound, making it more attractive to buy that small ski or lakeside property in Austria. Prices have by and large remained the static, other than the normal hotspot areas. This interest in Austria property and the sales, have created a lack of property choice. Owners are not sure whether to sell and put the money in the bank or hold onto their property. The concern is that with a lack of property on the market, those properties that do become available will be priced higher. .
Clients still Invest in Austria property
According to the British press..it seems like the whole of Europe is going to collapse. But we still have clients wanting to invest in Austria. They are mainly now from the new member states, such as Hungary, Romania and looking further east...Russian buyers are very keen to bring their money to Austria.
Not being money experts, we cannot really comment on the financial state of things, other than to say, it seems that the whole world has financial problems of one sort or another. The UK property market is at a standstill, Spain does not look so sunny at the moment, so Austria is still a safe bet for your money. Whether it is in Euros or goes back to the old currency, the property value is still here.
And..mortgages are still cheap in Austria, currently 2.25 - 2.75% there is no Inheritance tax nor capital gains tax..as long as you keep the property for 10 years...so it is certainly worthwhile to consider Austria as a safe property investment.
27/10/11 - November
Invest in Overseas property for income?
Maybe it is the uncertainty of Banks and the money markets, but we have found a new pattern emerging within the property market. Investors are once again looking at 'Buy to Lets' for an income and security for their money.
IN Austria it is taking the same route, with many people considering apartments and houses for long term rental. Also, interestingly they are looking at the commercial property market, particularly small shop outlets and offices. These normally have an existing business insitu and renting, thereby giving instant return on a property investment. At present the return is between 9-12% a very good income indeed! Then there is the tax benefit after 10 years of ownership. When you sell after 10 years there is no capital gains tax to pay on profit, another nice bonus,
01/10/11 - October
Save and Build your own house?
Many Austrians are trying to save on a house build by working on it also with a builder. 'He who will save a lot... must do a lot!! This is the advice for saving on a build. Of course not many people want to take on the whole job, but if you sit down and consider where you could help...the savings really start to stack up.
Building a house with about 140 m² of living space and a basement, you can save € 18,000 € on construction costs of say 250,000. At first glance, this sounds like a lot of money. But the work that must be provided for this is not to be underestimated. You can expect approximately 850 hours of work...almost 6 months!
Daunting...but one should not immediately throw in the towel. Some of the work when building a house can make sense. For example, to create the garden. Depending on the size it is taking in all some 30 to 45 hours. Can you create one? a design specialist for the garden, can easily cost 1200-1500