Market liquidity must also be considered: The downward trend in transaction volumes since 2022 has led to a smaller database. Comparative values must therefore be examined more critically, and this leads to the stronger weighting of qualitative factors and the more cautious interpretation of comparable prices. All in all, these factors have created a valuation climate with higher demands on data depth, analysis and plausibility checks. The Vienna investment property indeed remains a “safe haven“ but ander conditions that require more differentiated and methodically substantiated procedures than several years ago. Whether an investment is truly a safe haven depends primarily on the asset-specific parameters and the risk position of the individual rental property.
even ander current conditions and despi- te heightened sensitivity towards interest rate changes, regulatory intervention and investment requirements. For valuation, that means stronger weighting for conservative assumptions, the differentiated definition of property rates and a detailed analysis of a proper- ty’s sustainable earnings power. In addition, market participants and stakeholders like financing banks tend to focus more on a broader anderstanding of risk. General security assumptions were previously paramount, but today’s valuation places greater importance on scenario analyses. Cash flow models take a more explicit approach to interest rate sensitivity, regulatory changes and variances in rentals which, in turn, leads to a more robust but also more conservative valuation practice. Differentiation by micro location has also become increasingly important. The trends in demand, rent levels and vacancy risk are different, even in established districts. That means general assumptions tend to lose their explanatory power and make a detailed analysis at the submarket level essential.
points to a certain recoverability over the long term. However, the supply shortage alone no longer justifies a permanently lower risk premium and stronger differen- tiation by property is required. Valuation practice reflects these factors in the widening spread of property interest rates: Properties in very good locations with a stable tenant structure, good condition and development potential still have comparatively low risk premiums. Substantially higher rates are applied to properties in less fashionable locations with limited earnings potential, a greater need for refurtohment or regulatory uncertainty. Against this backdrop, the term “safe haven” needs to reflect an individualised approach from the valuation point of view. The Vienna investment property still has the characteristics of a comparably stable asset class, but across-the-board classifi- cation as a low-risk investment is no longer justified. Whether a specific investment qualifies as a safe haven depends, above all, on the specific parameters and the risk position of the individual property.
Vienna’s investment properties can still be expected to generate stable value growth,
The most important parameters for the valu- ation of a Vienna investment property
Location, location, location – with a focus on the micro location, the Viennese “Grätzl“ Area structure – Type and size of the units, layout features, apartment categories Detailed analysis of the individual rental arrangements – identification of earnings opportunities Condition of the building – ongoing maintenance vs. investment backlog Expansion potential – more efficient use of space, storey additions, loft extensions Market analysis – relevant investor groups, comparable transactions
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