APA ots-News: Steep price increases for residential real estate in Austria and CESEE
Vienna (APA-ots) – The strong upward trend in residential real estate prices continues unabated – this is also confirmed by the most recent real estate market analysis by the Oesterreichische Nationalbank (OeNB) for Austria and for Central, Eastern and Southeastern Europe (CESEE). In Austria, for example, price increases of more than 10 percent were recorded in the fourth quarter of 2021 – a trend that has persisted for five quarters (in each case compared to the previous year). Price increases have also remained strong in CESEE, so the overall dynamics in housing markets in some countries are raising concerns about financial stability risks.
Home ownership is becoming more and more expensive – the steep upward trend throughout Austria has been unbroken for over a year
In the fourth quarter of 2021, the price increase was again more than 10 percent compared to the previous year, both in Vienna (11.3 percent) and in the rest of Germany (13.9 percent). With an average of 12.6 percent for Austria as a whole, the price increase on the domestic residential real estate markets reached a new high.
The OeNB fundamental price indicator for residential real estate in Austria recorded the strongest increase since the start of the time series in 1989 and reached a level of 29.8 percent in the fourth quarter of 2021, 7.6 percentage points above the value of the previous quarter. The deviation from the fundamental factors shown by the indicator even came to 35.6 percent in Vienna, which corresponds to an increase of 5.1 percentage points compared to the third quarter of 2021.
Residential real estate prices in Central, Eastern and Southeastern Europe have risen even faster than in the EU as a whole
In CESEE, house prices recorded very high growth rates in the second and third quarters of 2021, which remain above the EU average. This development was influenced by several factors: On the demand side, the general economic recovery is likely to have played a key role in the price dynamics observed in the second and third quarters. In addition, the demand for home ownership has been boosted by government support measures (sometimes quite generous) to encourage housing in some CESEE countries. Financing side, lower interest rates continue the growth of home loans. Additional price pressure comes from rising construction costs and general material shortages, which limit the supply of new buildings. Developments in the residential real estate markets in some CESEE countries give rise to concerns about the stability of the local financial markets.
Further information can be found in the current issue of the OeNB’s real estate market analysis: Real Estate Market Report Q1/22 (only available in English): www.oenb.at/Publikationen/Volkswirtschaft/immobilien-aktuell.html
A map illustrating harmonized residential real estate prices can be found here. Time series for CESEE and the euro area in comparison to Austria as well as data on the Austrian real estate market can be found here: www.oenb.at/Geldpolitik/fokus_immobilienmarktanalyse.html
Further information: Oesterreichische Nationalbank Dr. Christian Gutlederer Press Spokesman (+43-1) 404 20-6900 [email protected] www.oenb.at
Digital press kit: http://www.ots.at/pressemappe/156/aom
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OTS0071 2022-02-23/10:27