Real Estate Boom in Austria
Property prices rose by 5.0% over the last two years. An end of the boom is currently “not in sight”, says the real estate industry.
“We now arrived at a point where “normal” people sometimes close their savings accounts or their life insurances and ask for real estate investments.”, real estate representatives say on the occasion of a press conference. According to the real estate agents, such people do not want profits, but a safe haven for their savings. In many cases, people tend not to invest in “anonymous” objects, but in real estate objects with a personal link, e.g. for student´s flats for their own children.
Over the last two to three years, property prices went up by 5.0% to 6.0%. On average, the price for a new owner-occupied flat per square meter reaches € 3,500 to € 5,000 in Vienna. The scope ranges from € 3,600 to € 4,500 in the Tyrolean capital Innsbruck and from € 3,500 to € 4,200 in Salzburg. The cheapest owner-occupied flats are observed in the Lower-Austrian capital St. Pölten, where the average price is about € 2,000 per square meter.
In spite of the high dynamics, the industry does not think that the trend continues in the coming twelve months. This may be due to the fact that adequate supply does not exist anymore and demand would evade rather than increasing prices further. A price decrease is not conceivable, although a real estate bubble like it happened in the U.S is not probable in Austria.