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Vienna sees bigger drop in house prices than any other European capital

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, according to new data.

Published: 18 May 2023 16:15 CEST
Updated: 19 May 2023 15:46 CEST
Vienna
A street in Vienna. Photo by Pond Juprasong on Unsplash

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 today.

According to the first-ever Bloomberg City Tracker, 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.

READ ALSO: Is now a good time to buy property in Austria?

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.

They also noted that 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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PROPERTY

Will my Austrian home insurance cover storm damage?

Severe storms have hit Austrian cities in recent weeks, and experts say extreme weather events will only become harsher and more frequent as the climate crisis worsens. What are your rights when it comes to insurance claims?

Published: 11 June 2024 12:57 CEST
Will my Austrian home insurance cover storm damage?

Austria has been hit by severe storms in recent summers, and the cost of the damages have increased yearly, now amounting to about €1 billion every year, according to the Austrian Insurance Association. 

The insurance industry expects further record loss figures for 2024 in view of the increasingly significant effects of climate change. 

But what are the implications for the those people in Austria who are affected by the damages? Will any of their insurance cover losses caused by natural disasters or storms?

Limited coverage

Austria’s Chamber of Labour (AK) told Austrian media that most household and homeowner insurance policies (Haushalts—und Eigenheimversicherungen Produkte) provide minimal coverage for damage caused by heavy rain, flooding, or mudslides, often between €4,000 and €10,000.

However, higher sums could be agreed upon individually with insurance companies, but for an extra charge. AK noted that in certain flood-prone areas, clients might not even get coverage at all.

READ ALSO: What kind of insurance do I need to have in Austria?

Austrian insurer Wiener Städtische urges people to check their insurance policies and evaluate whether they need to be updated. Most have low coverage amounts for damages, or the policyholder has not updated the value of properties in case of extensions, renovations, or pool additions, for example.

Household insurance (Haushaltsversicherung) covers household items, while homeowner’s insurance (Eigenheimversicherung) covers damage to the house itself. The latter also covers damage after a storm, such as a torn-off roof.

According to a Der Standard report, a comprehensive insurance policy on your car might pay for storm damage, depending on the type of cover. Still, standard liability insurance (Haftpflichtversicherung) will not pay anything due to storm damage.

It’s important to pay attention to the policy details. For example, if a vehicle has been damaged by water, you shouldn’t try to start it, or it could destroy the engine and insurance companies will not cover the damages anymore.

READ ALSO: ‘Haushaltsversicherung’ – How does Austria’s home insurance work?

If you suffer damage to an insured property, you should report it to the insurance company as soon as possible in writing. Most companies have a website or app that makes this easier. 

In case the insurance company does not refund your expenses, you could claim them as “extraordinary expenses” (Katastrophenschäden) in your employee tax assessment (Arbeitnehmerveranlagung). Businesses and freelancers can claim the costs as a business expense.

Most expenses can be claimed, including costs for the necessary construction of a new building, purchase of new furnishing (except for decorative items), clothing (up to €2,000) or supplies. However, you cannot claim costs in connection with a second home or luxury goods.

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