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Vienna in housing crisis: Prices are rising, new buildings are drastically reduced!
The Vienna housing market will be under pressure in 2025: rising prices, falling numbers of new buildings and structural shortages will characterize the situation.
Vienna in housing crisis: Prices are rising, new buildings are drastically reduced!
What's going on on the Vienna housing market? Current reports show that the situation is tense and the demand for apartments remains high. Although there is a slight increase in building permits, it is not enough to overcome the growing shortage. Loud The press The number of new buildings is falling sharply, while at the same time construction costs are rising.
Currently, only around 8,800 new apartments are expected to be built in Vienna by 2025. That's 20% less than last year! The situation is particularly bitter in the privately financed rental sector, where new construction output is more than 50% below the five-year average. There will be no improvement in sight for 2026 either; A slight increase to under 10,000 apartments could happen, but that simply will not be enough to actually relieve the pressure on the market.
Significant price increases
The consequences of this development are clearly noticeable: the average purchase prices in Vienna are now 6,500 euros per square meter, while the top rents are 19.40 euros per square meter per month. Housing offers for less than 6,000 euros per square meter can hardly be found anymore, and the situation is expected to worsen further from 2027 - then there will probably no longer be any offers below this price limit. A significant decline can be expected here, from 18% in 2025 to almost 0% from 2027.
A look at the building permits shows that although an increase of 16% was recorded in the first half of 2023, it is not enough to relieve the market. This positive development is now overshadowed by delays and financing problems, which have resulted in around 18% of projects being postponed by at least three months since May 2025. These uncertainties make new construction a gamble in which many property developers have to have a good hand in order not to be left behind.
The role of investors
The high prices and sustained demand have also increased investment volumes in the residential segment. Today, investments in housing represent 44% of the total market volume, with a peak return of 4.10%. Institutional funds are increasingly bringing existing properties between six and twelve years old onto the market, and while your own wallet benefits from these developments, the average Viennese is under even more pressure.
In addition, ESG criteria (environmental, social and governance criteria) are becoming increasingly important. Property developers are increasingly having their projects certified, which is well received by both investors and potential tenants. These sustainability-focused approaches could play a role in how the housing market develops in the future.
In summary, it can be said: The Vienna housing market is facing major challenges. The structural undersupply is obvious, and in order to improve market conditions, significantly higher completion figures are necessary. Without real relief, the situation for tenants and those looking for accommodation is unlikely to improve.