A drop in the ocean
- Housing prices in Austria fell in 2023 for the first time since 2004. The decline of around 1.5 percent even improves the affordability of real estate, which has fallen over many years, by around 10 percentage points in relative terms in view of a sharp rise in incomes of almost 8 percent compared to the previous year.
- In view of the widening gap between housing price and income growth over the past 20 years, however, this is just a drop in the ocean. In addition, the majority of the Austrian population cannot benefit from this price decline due to the increase in the cost of loan financing as a result of the ECB's monetary policy and because borrowing is made more difficult by legal measures.
- The continued restrictive monetary policy with unchanged lending regulations for housing finance in Austria and the declining growth in housing demand point to another year of falling property prices, but only in the midsingle- digit range. In view of the further rise in construction prices, the sharp drop in building permits and the continued high demand for property investments, an overly strong price correction is not expected in 2024 either.
as of February 2024.