Slight recovery in new residential construction: pre-sales rates as a hurdle

Slightly more new apartments will be completed in Austria this year than in 2025, according to the new construction report from the property developer database Exploreal out. Last year, 24,530 apartments were built, this year there will be a total of 28,530 – projects with five or more residential units are included. “We can maintain this level in 2027,” says Roman OberndorferChairman of the Association of Real Estate and Asset Trustees of the Austrian Chamber of Commerce.

Nevertheless, compared to many years, too little living space is being built. This shows loudly Alexander Bosak from Exploreal on the completion rate per 1,000 inhabitants: This was still 4.4 apartments in 2024; the rate is currently 3.0 residential units. In Wien The completion rate is the highest at 5.23 apartments per 1,000 inhabitants, followed by Vorarlberg and the Styria. The number of newly built apartments is lowest in Salzburg and Carinthia.

The reason why the number of newly built apartments has been falling since 2022 has to do with the Turn of phrase to do: after the long period of zero interest rates, loan interest rates have risen since 2023 and financing new buildings has become more difficult. “The commercial property developers have been very cautious since then,” says Roman Oberndorfer. This mainly has to do with financing. “Banks used to charge around 35 percent own funds for a property developer’s housing loan, today it is at least 60 percent.” “Need today Property developer “There is practically no bank left to provide financing because the capital is so high,” notes Oberndorfer. Added to this are the requirements of the financial institutions Presale relating to a new building project. “At least 50 percent of the apartments must be sold before construction begins,” says Oberndorfer.

The problem with this:

The sale “off plan”, which used to be in the area of new building which was quite common, no longer works. The reason: “The Buyer don’t want to be the first to buy an apartment.” It is often not clear whether and when the project will actually be built. For this reason, prospective buyers would ask carefully before purchasing an apartment in a new building that is not yet under construction. This means that currently, above all Existing apartmentsn be bought.

In general, the market shows that this is the case Housing offer becomes smaller. The absorption of condominiums on the market is increasing. Alexander Bosak says: “The supply of available apartments on the market is being reduced and therefore smaller.” Michael Gehbauerchairman of the association of non-profit building associations, is somewhat optimistic about the future as commercial property developers: the bottom in new construction has been reached in the area of ​​subsidized apartments, and the completion figures are currently stable. From 2027 he expects the number of newly built, subsidized apartments to increase slightly.