Rental price brake in Austria: billion-dollar savings for tenants 2025!

Rental price brake in Austria: billion-dollar savings for tenants 2025!

What is happening in terms of affordable living in Vienna? On June 2, 2025, a press conference with the new SPÖ residential building spokeswoman Elke Hanel-Torsch and Vice Chancellor Andreas Babler caused a sensation. The urgent focus was on the subject of rent increases in the regulated area, which, according to Hanel-Torsch, were now "intercepted". The official line provides for a rental price brake to keep an eye on the increasing costs. Since 2010, rents in Austria have increased by a whopping 70.3 percent, of which 25 percent in the past two years alone. This brings many tenants into a precarious situation, which is why Babler has committed: the next rent increase of 3.16 percent is to be prevented.

A look at the numbers shows that the tenants in Austria saved a total of 138 million euros in 2023 through the government's measures. Specifically, this means that a tenant of an old building with a monthly rent of 700 euros can achieve almost 1,000 euros in savings by 2027. But not all rental areas benefit immediately, the free housing market has not yet benefited from these measures. For example, rents in old building, community and cooperative apartments have to wait until 2024 until they are valorized.

planned measures for rental price regulation

The current plans of the government not only include the rental price brake for the coming years, but also an extension of the minimum limitation of rental contracts to five years. So far, the minimum period has been three years, which according to Hanel-Torsch has pressure on tenants. A rental price stop would be good news for the tenants, as over 70 percent of them could benefit from it. In Vienna in particular, 77 percent of tenants benefit from these measures, while it is only 49 percent in Vorarlberg.

The reform plans also stipulate that rents may increase by 2 percent in the next two years. Another significant point is the harmonization of tenancy law, which also targets commercial rents in order to keep them in a financiallyable manner. However, critics criticize that tenancy law in Austria is too fragmented, which does not make the situation easier for many tenants.

criticism and challenges

The new regulation does not only meet approval. The Austrian Association of the Real Estate Management (ÖVI) expressed sharp criticism of the press conference and questioned the figures presented. It is emphasized that the guidelines have been frozen since 2023, which could falter the plans. Questions about heating systems, legal certainty and the range of apartments have so far remained unanswered.

An additional point annoys many tenants and experts: The new regulations on the rental price brake only apply to all category and guideline rents as well as for cooperative and community apartments. New buildings are left out here-a fact that is emphasized by Neos MPs. This development is also reflected in the current housing costs, which for many households claim a significant part of their income and which are additionally stressed by the high inflation. According to an analysis of the statistics Austria, this area includes all financial aspects of living, from operating costs to energy costs.

While the government is trying to stabilize the housing market and get the rents under control, it remains to be seen whether the planned measures actually bring the desired success. The reforms initiated by Babler and Hanel-Torsch are the first step on a long way to more affordable living in Austria.

The developments in the living area are clearly a hot iron. The tenant association already offers free exams of rental contracts and rental prices to offer those affected in this tense situation. The coming weeks and months will show whether the measures taken are sufficient to actually tame the increasing housing costs. It is clear: there is still a lot!

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