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Vienna's rental prices are exploding: 10 euros per square meter is a reality!
Rent prices in Vienna are rising despite regulatory measures. New construction and rent control in focus: What does this mean for residents?
Vienna's rental prices are exploding: 10 euros per square meter is a reality!
Rents in Vienna continue to rise and are causing concerns for many residents. Surprisingly, the average gross rent exceeds the 10 euros per square meter standard for the first time. Despite the current rent cap, the ongoing price game seems to be gaining momentum. Loud ad hoc news Prices for new rentals even rose by nine percent to an average of 20.42 euros per square meter. The rent cap has little effect, and many criticisms from the real estate industry raise questions.
Vienna leads the ranking of the most expensive federal states in Austria. Compared to other countries, the capital has become an expensive place, with rents rising faster than the general inflation rate. The problem is compounded by a supply gap, which causes prices to spiral. While overall supply is stagnating, the constant influx of people into the city is leading to high demand.
Political measures and their effects
The federal government has now addressed the issue and presented a comprehensive package of measures for affordable rents. For the first time, price interventions for unregulated rents are also planned, such as Federal Government reported. In addition, the rent cap for the regulated area will be extended and expanded. One of the main changes is the increase in the minimum term of rental contracts from three to five years, which is intended to ensure more planning.
Vice Chancellor and Housing Minister Andreas Babler emphasizes how burdensome the high housing costs are for the population. Since 2010, rental prices in Austria have risen by over 70 percent, while private rents have risen sharply by 80 percent. For comparison: Rental prices in the Eurozone only rose by an average of 23.5 percent.
Challenges and criticism of the measures
Despite the planned changes, the situation remains tense. The Chamber of Labor has already asked whether these measures are sufficient to reduce the pressure on tenants. The real estate industry also criticizes the unclear regulation and sees the risk that investors will be deterred. Especially since fixed-term rental agreements allow for high rent increases and unregulated new buildings are not subject to the regulations.
The current drastic decline in the number of building permits is evidence of the difficulties in new construction. What’s the point? The exploding construction costs, lengthy approval processes and the stricter credit guidelines since 2022 play a decisive role here. It remains to be seen whether the new political measures can strike a balance between tenant protection and investment incentives.
The answer to the question of a sustainable strategy for affordable housing in Vienna is still up in the air. Another point that causes uncertainty is the ambiguity caused by the Constitutional Court ruling on value protection clauses, which presents tenants with additional challenges. The development of rental prices and the overall housing situation in Vienna remains worrying when compared nationally and internationally.