Viennese rents over 20 euros: apartments are becoming a luxury item!

Viennese rents over 20 euros: apartments are becoming a luxury item!

Rental prices in Vienna have reached a new record. Current figures show that asking rents rose in September20.42 euros per square meterhave increased, which represents an increase ofnine percentcompared to the previous year. This means that rents in Vienna are higher than ever, and those looking for an apartment have to be prepared for prices of over1,200 eurosfor one60 square meter apartmentdeal with. What is particularly noteworthy is that the average rent, including operating costs, is now for the first time10 eurosper square meter, as Statistics Austria states.

What caused this increase? “High demand meets shrinking supply” is how the situation describes the problems on the housing market. On top of that, there will be a decline in new buildings of up to50 percentpredicted. For 2025, the number of new apartments will be completed9,400 to 11,000estimated, which is a third less than 2023. Developers are increasingly choosing to build profitable condominiums rather than offering rental properties. This leads to a further decline in the number of rental apartments available.

Decline in the rental market

The situation on the rental market could get even worse. Forecasts suggest that the decline in the free rental market will over50 percentcould be. This is happening in an environment where construction costs have fallen by almost since 201050 percenthave increased and the number of building permits in 2024 has fallen to its lowest level in a decade. The federal government has the goal of400,000completions per year, but this target has been failing for years.

The situation is not only tense in Austria. Rents are also rising significantly in Germany, which underlines the tense housing situation in the entire DACH region. The Tagesschau registers an increase in rents4.7 percentin the fourth quarter of 2024, especially in cities like Berlin, where rental prices are around8.5 percentclimb. High demand for rental apartments and a lack of new buildings are also prevalent problems here.

Housing as a luxury good

For many people looking for an apartment, living is increasingly becoming a luxury item. In previous years, more and more people have hit the price peaks, which means that one in three renter households is overburdened with housing costs. Homes are becoming more expensive – prices for apartments and houses rose in the first half of 20252.8 percentrespectively3.6 percentfor new objects. Given these price increases, buyers looking for a property need to be extremely careful and pay attention to their budget.

The ongoing price increases and the steady decline in new construction make it clear that the housing situation in Vienna and many other cities remains a challenge. The rising rents and purchase prices are like a sword of Damocles hanging over many people's heads and clearly show that there is a need for action.

The question remains as to how the situation on the housing market will develop. Will political interventions follow or will developments continue as before? It is clear that those looking for an apartment must expect intense competition and persistently high costs.