March 20th, 2022

Housing in Vienna: affordability as a challenge

The prices for residential property are rising to lofty heights. How can housing in the city remain affordable? Subsidised ownership is a means to an end.

In a project of the property developer Mischek in the urban development area “Leben am langen Felde” in Vienna-Donaustadt, subsidised condominiums are currently being built.

Anyone who wants to buy a flat in Vienna at the moment does not have it easy. On the one hand, despite the construction boom, the choice is not much greater than before because most of the current volume of new construction is coming onto the market as rental flats.

On the other hand, prices have really galloped away in recent years. And that, in turn, is now causing the granting of housing loans to be tightened – because the National Bank has been warning of an overheating of the market for quite some time. On behalf of the European Central Bank (ECB), the National Bank and the Financial Market Authority are expected to introduce new minimum standards for lending starting in the summer. In future, for example, an equity ratio of at least 20 percent will be prescribed.


The land registry specialist Immo United recently took this as an opportunity to compare the purchasing power of the Viennese with the prices in the individual districts. Conclusion: In all districts except the tenth, at least two average net annual salaries of 24,700 euros are needed in order to be able to raise at least the equity share in the future. A developer flat in the third district, for example, is currently offered for an average of 402,900 euros (net), which means at least 80,600 euros in own funds – 3.3 times an average annual salary. The ratio is naturally quite extreme in the Inner City, where one needs about seven annual salaries for one’s own funds. This is because used flats there are currently offered for an average of 857,000 euros net, so the minimum equity contribution would have to be around 171,000 euros. Developer flats are only slightly more affordable because they are smaller on average; Immo United quotes 6.1 times the annual salary. “However, these are extreme values that are not representative for the rest of the federal capital.” With the exception of the first district, one only needs more than 100,000 euros of one’s own
district, only developer flats in the 18th and 19th districts require more than 100,000 euros. In the 22nd district, where most of the construction is going on, you need about 2.5 years’ salary to be able to raise the own funds.

Admittedly: These statistics don’t say much about the prices per square metre. But according to data from the National Bank, property prices in Vienna have risen by around a quarter in the last five years alone. Vienna is thus becoming visibly unaffordable. It is to be hoped that the new lending guidelines may also be able to keep property prices in check a little.

Subsidised property

What the City of Vienna now also wants to push again is the promotion of home ownership. For many years, so-called instant ownership in subsidised Viennese housing was not pursued, but now, according to information from the office of housing councillor Kathrin Gäal (SPÖ), there have been several projects again since 2017 with 359 residential units already, all in districts 22 and 23, a spokesperson tells the STANDARD. In addition, some are currently under construction in the project “Leben am langen Felde” on the former Hrachowina grounds as well as in Podhagskygasse, and a project is planned in the Berresgasse development area, all located in Donaustadt. But how exactly does this actually work, and who gets these subsidised flats?

Basically, the purchase price is only slightly lower than for a privately financed option. On the other hand, with a subsidised condominium you have the option of taking out an equity replacement loan from the city with an interest rate of one per cent per year. However, there is no obligation to do so, and in the case of the previous projects since 2017, it was also the case that the subsidy was provided for 22 residential units, but then not taken up.

Income limit

In the “Green Eastside” project on the Hrachowina grounds, developer Mischek is building not only 132 privately financed but also 82 subsidised condominiums; completion is planned for the end of the year, all subsidised units have already been allocated, partly directly by the developer, partly by Wohnberatung Wien, a spokeswoman informs us. The amount to be paid immediately is 2,500 euros per square metre, the rest of the subsidised purchase price is granted as a loan and repaid in the long term. An income limit must be observed, as is also customary for subsidised rental housing. In addition, one’s own main residence must be registered in the purchased flat, i.e. one must live there oneself. This is to prevent all or most of the flats in a new construction project from being bought by investors.

Source:, 20.03.2022

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Mosam Real Estate was founded in 2017 and is headquartered in Vienna. The owner-managed company sees itself as a comprehensive real estate service provider and residential developer. The focus is on the high-quality marketing of residential and commercial properties throughout Austria, as well as the renovation and construction of residential buildings, taking into account the current possibilities of sustainable and climate-friendly building materials and construction methods.

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