Highlights from the "Residential Real Estate Market Austria: Declining Interest Rates, Rising Prices?"
On March 13th, over thirty financial professionals gathered for an insightful event titled “Residential Real Estate Market in Austria: Declining Interest Rates, Rising Prices?” organized by CFA Austria, an affiliate of the global Chartered Financial Analyst (CFA) Institute. Matthias Reith, senior economist at Raiffeisen Research, provided a comprehensive analysis of the Austrian real estate market.
On March 13th, in cooperation with CFA Austria, over thirty participants attended the event titled: “Residential Real Estate Market in Austria: Declining Interest Rates, Rising Prices?”. This was presented by Matthias Reith, a senior economist at Raiffeisen Research.
Matthias started with a detailed analysis of Austria’s real estate market, exploring the impact of recent wage increases on homeownership, particularly emphasizing how homeownership has become more accessible despite prices holding steady. Matthias’s constructive view of the lending landscape stresses the impact of the role of declining interest rates in shaping property prices.
Matthias highlighted in the presentation, that property prices in Austria continued to decline until recently, but that the pace of price declines slowed down in the course of 2024. New apartments continued getting more expensive, while price drops were mainly seen in existing properties. All in all, Matthias expects that the period of falling property prices should end in 2025, with moderate increases anticipated by 2026 due to factors such as lower interest rates, rising incomes, a growing population, and fewer new constructions. Meanwhile, rents have risen significantly, particularly in Salzburg, Vorarlberg, and Vienna, making renting noticeably more expensive
To mitigate the challenges on the housing market, the new government has proposed reviewing building standards and abolishing the land transfer tax for first-time homebuyers, which are significant steps towards achieving long-term affordability. Regarding the planned rent capping, Matthias stated the view that the undisputable rent increases are also a symptom of shortages on the rental market and not only the result of inflation. An even stricter limitation of rent increases should make things worse, as rent capping is not only socially imprecise but disadvantages those it aims to help. To ensure sustainable solutions, comprehensive reforms are essential, balancing both immediate needs and future housing demands.
The event came to a close after the participants took part in engaging discussions, exchanging their insights.
About CFA Austria
Consisting of portfolio managers, security analysts, investment advisors, and other financial professionals, we promote ethical and professional standards within the investment industry, encourage professional development through the CFA Program and continuing education, facilitate the exchange of information and opinions among people within the local investment community and beyond, and work to further the public's understanding of the CFA designation and investment industry.
About Raiffeisen Research
Raiffeisen Research offers corporate and institutional clients in-depth market information covering a broad-spectrum of markets, companies and industries with a strong focus on Austria and CEE.