Austria is one of the most attractive countries in the world for real estate investment. Foreigners buy houses and apartments here not only for permanent residence or holidays at numerous resorts, but also to increase capital.
Buying real estate in Austria has its advantages and practically no disadvantages, with the exception of a number of formalities, which we will discuss below.
Pros of buying property in Austria
Austria is a country with a high level of political and economic stability. Real estate here does not become cheaper even during crises; since 2004, housing prices have only been rising. Austrian laws reliably protect property owners. Most resort properties are sold at the construction stage, and according to the Law on Developers, the developer cannot violate the delivery deadlines specified in the contract, and even if the company is dishonest, the buyer does not lose his money.
Combination of rest and income
There are more than 380 resorts in the Austrian Alps, many of which are suitable for holidays throughout the year. In winter people go skiing and snowboarding here, in summer they go in for golf, trekking, sailing, cycling and motor sports. An apartment in a residential complex at a resort can be rented out when it is empty.
Guaranteed income 3-6% per annum
One of the most popular forms of investment in Austrian real estate is the purchase of apartments in resort hotel complexes. Having become the owner of such real estate, you can completely shift the care of your assets to a management company, which independently looks for tenants and is fully involved in managing the property, and receive an income of 3 to 6% per year.
Disadvantages of buying property in Austria
The main and, perhaps, the only disadvantage for investors is that it is difficult for foreigners to obtain permission to purchase real estate in Austria. Local authorities must approve the deal, and the rules governing the issuance of permits differ in different states and even municipalities of the country. In many popular resort areas of Tyrol, Salzburg, Vorarlberg, citizens of countries outside the European Union cannot make a purchase in any other way than by registering a transaction with a legal entity. It is much easier to buy real estate in Austria with a residence permit in the country.
The most attractive regions for investment in real estate in Austria are ski resorts and large cities such as Vienna and Graz.
The Austrian capital has been recognized as the best city to live for 9 years in a row according to the Mercer agency. The main advantages of the city, according to analysts, are considered to be a high level of safety and healthcare, a developed transport system, and good ecology.
At the same time, real estate in Vienna costs less than in other capital European cities. You can buy an apartment in respectable areas located near the center at a price of 4 to 8 thousand euros/m2. The best areas for purchasing and then renting out are the areas of Margareten, Mariahilf, Favoriten, Leopoldstadt, Neubau.
There is a large selection of high-quality new buildings at a price of 3.5-5.5 thousand euros/m2, which is several times cheaper than in the very center of the city. The yield from renting apartments in these areas is 4-5% per year.
A profitable long-term investment in Vienna is student apartments. Students make up almost 10% of Vienna’s population, with a third of them foreigners renting accommodation. The cost of apartments in special complexes located near universities starts from 200 thousand euros. If the apartment is purchased for rental, the buyer will be refunded VAT included in the price in the amount of 20%.
Graz is the second largest city in the country, the capital of Styria. Tourists come here to wander around the well-preserved Old Town, admiring the Baroque palaces and Renaissance fortresses.
Graz is the only city in Austria where foreign buyers can purchase any amount of real estate. Apartment prices here are lower than in Vienna. You can buy quality real estate at a price of 3 thousand euros/m2. Yields range from 2.5 to 5%; small one-bedroom apartments are in high demand. The city is home to a number of large enterprises, universities, research centers, and hospitals, so the demand for rental apartments is consistently high.
A chalet or apartment in the Alps is a profitable investment. The Austrian Alps attract property buyers with lower prices than in France and Switzerland. The cost of apartments in a residential complex with hotel services starts from 200-250 thousand euros – a third lower than in neighboring countries.
There are many popular resorts in Austria that are popular among skiers, such as St. Anton am Arlberg, Ischgl, and Kitzbühel. Many people like to relax here, but it is almost impossible for foreigners to purchase real estate in such places. At the same time, there are many picturesque regions with developed recreational infrastructure that are not so well known, but offer a larger selection of new facilities at affordable prices. These include, for example, Klippitztorl, Kaprun, Neukirchen, Bramberg.
For investors, the optimal locations are located at an average altitude, with approximately the same duration of the winter and summer seasons. It is especially beneficial to choose resorts near glaciers, where the opportunity to ski and snowboard is added to summer entertainment.