Tenants have a winning position within the Rental Market in Vienna

Vienna has been witnessing a strong demand for rental units in the affordable category worth up to EUR 700–800 for quite a while, as brokers frequently obtain hundreds or thousands of inquiries for one ad. However, there is not so much choice within this segment at the moment, as Vienna has experienced a construction boom in terms of spacious attic units and commercial rental apartments.

According to Michael Pisecky, chairman of the real estate trustees, tenants are provided with a wide array of options priced at EUR 1,200 and more. In fact, the supply exceeds the demand in this category.

Over the last 5 years, rental prices in Vienna have increased by EUR 2 per sq. m, however recently, the prices have started leveling off and even dropping in some areas.

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The situation is a little bit unpredictable, as on the one hand, there are currently strict lending rules and increasing value and interest rates are fuelling the local rental market. In fact, according to Pisecky, whilst previously 60% of inquiries were focused on home ownership and 40% on rentals, at the moment, it is the other way around.

On the other hand, the volume of new construction in the capital is decreasing, which will lead to fewer new properties that will enter the market in the future. And not everyone is aware of the fact that more and more individuals of late, are opting to rent instead of owning a property. Overall, amidst the inflation adjustment, it is easier to negotiate with landlords than it was earlier regarding the conditions of the rental period, including a maximum annual rental increase.