Key Highlights
- Salzburg enjoying solid decade of price growth, +110% in 10 years
- Housing prices across Austria grew +8% y/y in 2018, according to Oesterreichische Nationalbank, Austria’s central bank
- Since pandemic, prices in high-end areas up +7-8%
Austria is one of the few housing markets in the world that has remained relatively untouched by the COVID-19 pandemic. In the Baroque town and environs of Salzburg that are filled with lakes, valleys, rolling hills and steep alpine mountains, “…there was a postponement (of approximately six weeks beginning in mid-March) of certain discussions and transactions, but not a real shutdown,” said Mark Husges, a license partner with Engel & Volkers Zell Am See. “Prices remained extremely stable and will continue to rise as they did the past couple of years.”
Download Your FREE Ultimate Agent Survival Guide Now. This is the exact ‘do this now’ info you need. Learn NOW How to Access All The Bailout Program Cash You Deserve. Including Unemployment and Mortgage Forbearance Plans. To Access the Ultimate Agent Survival Guide Now Text The Word SURVIVAL to 47372. 4 Msgs/Month. Reply STOP to cancel, HELP for help. Msg&data rates may apply. Terms & privacy: slkt.io/JWQt
Nearly half of Salzburg’s residents rent their homes to tourists during the winter months. Prior to COVID, residents spent their money on city apartments but now, like Americans, Salzburg homeowners are more interested in suburban neighborhoods with small houses and gardens in the event of a second lockdown. Again as in America, Austrians are afraid of losing money to inflation and are “running up real estate right now,” said Marlies Muhr , owner and chief executive of Marlies Muhr Real Estate.
High-end properties in Salzburg begin at approximately $900,000 and go up to $17.8M. Properties with views of the Hohensalzburg Fortress, a completely preserved medieval castle, easily command prices hiked up another 25%.
Both demand and prices in neighboring Kitzbuhel, 60 minutes from Salzburg and 90 minutes from Munich, have gone “through the roof,” according to Muhr. Likewise in Vienna, according to John Philipp Niemann, managing director in Vienna for Engel & Volkers.
Austria’s tax structure, typically higher than other European Union nationals yet void in inheritance taxes, is basically a wash for high-net worth European Nationals looking to move their residences. Chinese clients, Swiss nationals and Austrians living abroad tend to buy in Vienna; Italians tend to buy in Vienna, Innsbruck or Salzburg; and Americans “…love Salzburg as a cultural and holiday destination as well as a place to live,” said Husges.
Homebuyers in Austrian ski towns come primarily from Germany, the Netherlands, Belgium, Italy and Great Britain.
American buyers as well as others outside the European Union must form a corporation in Austria or another European Union country to verify ongoing financial connections. Some states within Austria such as Salzburg have stringent restrictions on using residential properties as either second homes or holiday/tourist lodgings. (Obviously, it’s best to consult a tax advisor.)
Homeowners in Austria pay no annual property taxes yet do pay an annual fee of about $750 for water, sewage and garbage collection. There is a onetime 3.5% fee at closing and a 1.1% land registry fee paid by buyers.
Thanks to The New York Times International Real Estate Section.
Also read: Podcast: The Zillow Threat Is Real, Are You Paying Attention? | Tim and Julie Harris, Ultra Wealthy Battening Down the Hatches, What’s Booming – What’s Not – And Where?
