Vienna apartment house market back at pre-crisis level
After a small Corona-related dip, the Vienna apartment house market is now literally flooded with money again!
According to latest apartment houses market report, 677 million euros were invested in apartment houses in the first half of 2021, which was 50 percent more than the long-term average for the years 2012 to 2020. Only in 2018 and 2019 have there been higher volumes in the first half of the year. “It is thus clear that the market is recovering from the restrictions due to the corona crisis and is close to pre-crisis levels”
Compared to the same period of the previous year, the plus was equal to 83 percent. Overall, however, the total for year 2020 came to almost 1.3 billion euros again and was thus the fourth strongest year on the Vienna apartment house market.
Only 13,782 Founder apartment buildings left
The Immobilien market sets very narrow limits when defining what constitutes an apartment building. Only Wilhelminian-era apartment buildings built between 1848 and 1918, which were built in a closed construction and in the style of historicism and in which no condominium ownership was established, are considered for selling or expansion.
And naturally, there are fewer and fewer of these: mainly because of so-called parifications, i.e. the establishment of condominiums, houses regularly disappear from the statistics, but demolitions also take place. In the Autumn of 2009, when the first Otto apartment house market report was published, the company counted 15,529 Gründerzeit apartment houses; currently, the figure is now only 13,782 (as of August 14, 2021).
Outer districts lead in sales
263 apartment houses or apartment house shares, sold in the first half of the year. With the exception of the districts 4, 8 and 11, there was an increase in all districts of Vienna. “Most houses were sold in the 6th and 20th districts,” Nevertheless, the boom of the districts outside the Inner Ring continued. In total 68 percent of the transactions and 51 percent of the transaction volumes took place outside the Inner Ring.
There, prices remained grosso modo stable, at least as far as maximum prices are concerned. Only in districts 12 and 21 were there high swings in maximum prices of 14 percent in each case. Minimum prices, on the other hand, increased noticeably in several districts, including districts 1, 2 and 3, with increases of between ten and 15 percent. “The lowest entry prices are still to be found in the districts outside the Inner Ring, but in the meantime no Viennese Gründerzeit apartment house in average condition is being sold for less than 1,800 euros per square meter,” knows Richard Buxbaum, head of residential real estate at Otto.
Companies sell more
On the buyer side, companies clearly dominated, “but they are also becoming stronger on the private seller side,” Buxbaum reports. According to the report, nearly 64 percent of all purchases as well as 52 percent of all sales came from companies. In the case of sales, around 56 percent of the transaction volume was achieved by companies, while 43 percent was attributable to private individuals.
With the value increase potential of the houses one looks obviously ever more frequently at the attic. “A high proportion of the sold houses shows a development potential here”, Then relatively high square meter prices are paid, because one acquires so to speak also building ground for further dwellings with such a house. An end of this trend is not in sight. On the contrary: “We assume that in the next few years, due to the lack of land, the interest in apartment houses with expansion potential will continue to be very high.”
Source: Der Standard