Real Estate Market Shows Slight Recovery: Single-Family Homes in Trend

The domestic real estate market improved somewhat last year - at least in certain areas. Sales figures for single-family homes rose significantly. There was still a decline in apartments, but this weakened considerably compared to 2023, according to the RE/MAX real estate report. Commercial properties continued to decline. Overall, there was a decrease of around eight percent in registrations and their value.

Overall, the real estate market also weakened last year. "In 2024, most types of properties are still in a landing approach, with a significantly lower rate of descent than in 2023, some still in a steep dive, but some are already taking off again," describes Anton Nenning, RE/MAX Austria Head of Research, the situation. The number of registrations fell by only 7.8 percent to 100,854 last year, after a decline of 25.3 percent the previous year. The value of registrations decreased to 28.77 billion euros, down by 8.1 percent. But here too, an improvement was evident, as there was still a minus of 28.9 percent in 2023.

Single-Family Homes in Demand

The industry recorded growth in single-family homes last year: The number of transactions increased by 19.4 percent, the total value by 18.2 percent - indicating a slightly lower average price per transaction. For semi-detached houses, there was a decline in registrations by 0.8 percent, but their total value increased by 4.8 percent. Similar developments were seen in other buildings (registrations: -1.8 percent; value: +3.9 percent) and house shares (-2.3 percent; +31.0 percent). There were also declines again in multi-family homes (-3.7 percent; -5.6 percent).

For apartments, transactions decreased by 9.1 percent and the total revenue of these transactions by 8.2 percent. Attic apartments were evidently even less in demand (-10.5 percent; -15.0 percent). However, revenue for terraced houses increased slightly despite a still declining market (-10.5 percent; -7.4 percent). A similar trend was seen in the price development for parking spaces (-13.0 percent; -5.0 percent), while average prices for land transactions fell (-11.7 percent; -20.9 percent).

In this context, owning one's own four walls pays off in terms of living satisfaction, according to a trend study by ImmoScout 24.at. Residents of more than 130 square meters rated their living situation with a score of 1.4. Those who own a house or live in their own property scored 1.5. Respondents living in a village (1.7) or the surrounding area (1.6) were also more satisfied compared to those in urban locations (1.9).

Significant Declines in Commercial Properties

Significant losses were observed in commercial real estate: For hotels and accommodation establishments, the transaction volume fell by 78.5 percent, with a value decrease of 61.7 percent. The average price for office buildings dropped: With 32.4 percent fewer registrations, the total value decreased by 42.6 percent. The business with tenement shares collapsed by 41.7 percent in terms of registrations, while the volume decreased by 34.6 percent. Real estate transactions with retail spaces (-20.9 percent, -30.3 percent) and office spaces (-25.3 percent; -22.4 percent) also declined. Although 26.1 percent fewer tenement houses were registered last year, the average transaction price increased, as this segment recorded a value increase of 3.5 percent. In contrast, storage spaces were in high demand among commercial properties, with both the number of registrations and the value increasing significantly (+28.7 percent; +35.3 percent).

In the agricultural sector, there were significant declines in both registrations and sales (-36.0 percent; -44.4 percent). Although forest transfers increased by 4.4 percent last year, the average price per transaction dropped significantly compared to 2023. The total sales were 45 percent below the previous year's value.

Buildings by the water were evidently less in demand last year (-46.1 percent; -24.7 percent). However, these were evidently higher-value properties. In contrast, the average price for waterfront plots fell (-44.0 percent; -69.1 percent).

Salzburg Increased

However, the real estate market did not develop uniformly across all federal states: Carinthia recorded a decline in registrations of 17.9 percent compared to the previous year, followed by Tyrol with minus 10.6 percent and Styria with minus 10.5 percent. Lower Austria (-7.6 percent), Upper Austria (-7.5 percent), and Vienna (-6.5 percent) performed better. Burgenland (-1.5 percent) and Vorarlberg (-1.2 percent) got off lightly. And Salzburg was even able to increase real estate transfers by 1.1 percent.

RE/MAX points out in its real estate report the declining interest rates, lower inflation, and the temporary exemptions from fees for the registration of property rights and liens in the land register, which have recently helped the real estate market somewhat. No change will result from the expiration of the KIM regulation, which restricted the granting of mortgage loans. The regulation will practically be replaced by a recommendation.

The data source for the RE/MAX Real Estate Report has been the recording of all purchase contracts in the land register since 2009, which are read by IMMOunited and analyzed by RE/MAX Austria.

(APA/Red)

This article has been automatically translated, read the original article here.