When housing is the best investment
Investment apartments have grown from a tax-saving model into a crisis-resistant in- vestment form that links asset appreciation with stable, steady income. That makes them a central element of modern asset planning. Especially in times of uncertainty, investment apartments offer additional stability as a real value that satisfies a basic need. The renewed growth in demand is currently contrasted by a progressively smaller supply. Building permits are declining, and housing is becoming a scarce commodity. These factors create excellent prospects for investment apartments: Stable and steadily rising rents together with long-term value appreciation make them indispensable in the current market environment.
Hausgrundweg 3 1220 Vienna
Classic investment apartment model
Investments as a small businessperson
Capital investment with a long-term perspective and clear tax framework.
The basic principle underlying investment apartments involves a capital investment in real estate combined with the use of advan- tageous tax regulations to create long-term value stability. Wealth can be accumulated here through the structural mixture of rental income, depreciation and input VAT. The foundation of a sustainably successful investment is, however, based on steady market demand and developments that can be realistically estimated. The demand for housing remains consistently high, not only in Vienna but also in Austria’s western provincial capitals. Demographics are one of the main catalysts for this trend – on the one hand, through the influx of residents from surrounding regions who are looking to enjoy the superior infrastructure, conve- nience shopping and connections offered by larger cities and, on the other hand, by persons relocating to study or work. These factors produce a broad and stable
demand base across various target groups, but project developers are still acting with greater caution due to the general econo- mic environment. Rising construction costs, more demanding financing requirements for new residential buildings and general uncertainty have led to the postponement or cancellation of numerous projects. In view of these circumstances, the situation can only be expected to ease gradually in the coming years. The consequence is the concentration of demand on a limited supply. That will lead to greater pressure on prices, a development that has also become more visible in the condominium segment. On the rental market, the supply shortage has been evident for some time. Rents rose by roughly 5% on average and up to 12% at very good residential locations from 2024 to 2025, depending on the submarket. Vacancy rates declined during that time, and apartments were frequently
re-let during the previous notice period for a nearly seamless change in tenants. Similar developments can be expected in 2026, which means a further increase in the need for additional housing in the rental segment. Another important factor is the quality of the building. Sustainable, energy efficient concepts are becoming a more important factor and represent a central decision criterion for many buyers. In addition to ecological aspects, they make an essential contribution to the long-term value stability and attractiveness of a property. All things considered, the current market conditions – which are influenced by high demand, limited supply and stable financing conditi- ons – continue to present a solid basis for investments in residential properties.
A flexible model for private investors with a view towards later owner use or brief rental
• Purchase at the investor price plus 20% VAT • Deduction of input VAT from taxation authorities possible
• Mandatory rental for 20 resp. 25 years • Taxable (VAT) rental, excl. owner use
• Purchase at the owner-occupier price, excl. VAT • VAT-free rental as a small businessperson
up to annual revenue of € 55,000 • No tax benefits but high flexibility
Attractive yields through rising demand for housing
Sustainability pays
Declining new construction versus constant high demand for living space. • Ongoing shortage of living space – high demand especially for urban locations with good infrastructure • High earnings security through rental income • Long-term value appreciation for investors
Tax benefits for sustainable construction models, greater impor- tance for investment apartment buyers. • Accelerated depreciation: applicable to all buildings built on or after 30.06.2020 and to both investment apartment models • Super-accelerated depreciation: applicable to buildings completed by 31.12.2026 with appropriate certification (e.g. klimaaktiv > Bronze)
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