Vienna Only European City to Witnesses Steepest Decline in Property Prices
The Austrian capital saw one of the steepest declines in property prices over the last year – and was the only major European capital to see a double-digit fall. Having peaked about a year ago, Vienna real estate prices are down by 12.2 percent compared to what they were at this time in 2022 – to about €7,084 per square metre. The drop is well ahead of other European capitals. Stockholm had the next largest fall with a 6.4 percent decrease. At the same time, prices in other major cities like Madrid, Milan, and Zurich all increased over the last year. Bloomberg analysts noted that they expect prices in the Austrian capital to go down further, with stricter mortgage rules putting downward pressure on prices. The number of mortgages issued to Austrian households has fallen by more than 60 percent since March 2022. The city’s rental market is creating less incentive for people to buy. Many families have affordable long-term rental contracts, including in social housing, and don’t need to necessarily think about buying. Prices were however still higher than pre-Covid, when many people opted to move to bigger places due to working from home more. The Austrian Central Bank estimates that homes in the country could still be overvalued by as much as 40 percent on average.
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