Austria has always attracted foreigners with its high standard of living, safety, strict environmental standards, and comfort. It is no surprise that Vienna, Austria’s capital, consistently ranks as one of the best cities to live in worldwide. However, moving to Austria for permanent residence can be time-consuming, stressful, and financially demanding. Therefore, before making such an important decision, it is essential to familiarize yourself with the potential challenges that foreigners may face.
Renting or Buying Property in Austria: What to Choose?
One of the key questions for newcomers is whether to rent or buy property. Initially, renting is the better option as it allows you to adapt to the local environment and identify the most convenient area for permanent residence. Buying property has its advantages but requires significant financial investment and thorough legal support.
What Do You Need to Rent an Apartment or House in Austria?
The rental process includes several steps:
- Choosing a district and searching for accommodation: It is recommended to use websites like Willhaben, Immobilienscout24, and social media platforms, where apartments may be listed directly by owners.
- Hiring a real estate agent: The service fee is typically two months’ gross rent + 20% VAT.
- Preparing documents:
- Identity documents: passport, residence registration, and proof of legal stay in Austria (e.g., residence permit, visa, etc.).
- Financial documents: proof of income (having a job in Austria is a significant advantage) or a bank statement, and a guarantor (e.g., parents who will cover rental expenses for their children).
- Additional documents: some landlords may require a guarantor who is an Austrian citizen if they consider the other documents insufficient.
- Signing a rental agreement:
- Signing a preliminary rental contract (Mietanbot), confirming the tenant’s intent to rent under specific conditions.
- Signing the main rental agreement (Mietvertrag).
- Paying a security deposit (Kaution) usually equivalent to 3–6 months’ rent (the amount may be increased at the landlord’s discretion).
In Austria, landlords carefully select tenants since demand for housing exceeds supply. This means that rental applications may be rejected, or additional conditions may be imposed—such as a higher security deposit, prepayment for several months, or a guarantor from an Austrian citizen or company.
Features of Long-Term Rentals
Most rental agreements are signed for 3, 5, or 10 years. However, tenants have the right to terminate the contract after 12 months of residence by giving three months’ written notice to the landlord. Thus, the minimum rental period is 15 months. It is essential to read the rental contract carefully to avoid hidden fees.
How to Buy an Apartment or House in Austria?
Citizens of EU countries have the same rights as Austrians and can buy property without restrictions. However, citizens of third countries, including the USA, Canada, Australia, China, Arab nations, and CIS countries (including Ukraine), must obtain approval from the magistrate to purchase real estate.
Main Steps for Buying Property in Austria:
- Find a real estate agent, as the buying process is complex and requires professional assistance.
- Select a property and arrange a viewing (it is advisable to visit multiple times to clarify all questions).
- Sign a preliminary purchase agreement (Kaufanbot), which must be accepted and signed by the seller. From this moment, both parties are obligated to complete the main purchase contract under the agreed conditions.
- Finalize and notarize the main purchase contract (Kaufvertrag).
- Pay for the property. The buyer’s funds must be held in an Austrian or other European bank account and have a legally confirmed source.
- Pay taxes and fees, including the real estate purchase tax (3.5%) and registration fee (1.1%). Read the articleto learn about additional costs when buying real estate in Austria (Nebenkosten), as well as how to reduce them.
- Pay for additional costs such as real estate agent services (3% of the property’s value + 10% VAT), notary and legal fees, and other administrative costs.
Magistrate’s Approval for Foreigners Buying Property
The magistrate evaluates the buyer based on the following criteria:
- Legal status: Verification of the buyer’s legal residence in Austria and compliance with immigration regulations.
- Social ties: Assessment of the buyer’s integration into Austrian society—such as knowledge of the German language, whether their children attend local schools, and social contacts.
- Financial stability: Evaluation of the buyer’s ability to finance the purchase and maintain the property. Typically, at the time of application, the buyer must transfer a substantial part of the property’s cost to an escrow account managed by a lawyer or notary.
- Compliance with legislation: Ensuring that the transaction does not contradict Austria’s national interests or legal requirements.
According to Austrian law, obtaining the magistrate’s approval should take up to three months. However, in practice, the process can take 6 to 9 months or longer, depending on the applicant’s circumstances and the efficiency of document submission.
Does Buying Property Grant the Right to Residence in Austria?
Unlike some other EU countries, purchasing real estate in Austria does not automatically grant a residence permit. On the contrary, non-EU citizens must first obtain a residence permit before they can apply for permission to purchase property.
Conclusion
Before moving to Austria, it is crucial to carefully consider your housing options. Renting allows for adaptation without significant financial commitments, while buying property is a long-term investment that requires thorough planning. Consulting with professional real estate agents and lawyers will help you navigate legal complexities and make your relocation process as smooth as possible.
