Parification
Last exit sell-off: Opportunities but no simple strategy
Herwig M. Peham MRICS
Head of Investment EHL Investment Consulting GmbH
The (obvious) reaction of many investors and developers to legal intervention in existing rental contracts is to sell when renting becomes more difficult. The optimised sale of an investment property through the marketing of indi- vidual units requires strategic planning and careful imple- mentation.
The suspended indexing of benchmark rents which has appeared under the keyword “rental cap” covers not only municipal and not-for-profit residential
as easy as it might appear at first glance. Expertise, a fair amount of work and, last but not least, a lack of time constraints are required to optimise results.
the form of an advance payment for the cancellation of a valid lease, can be a reasonable solution in other situations. The only remaining possibility is to be patient and postpone the sale indefinitely. Take the right decisions at the right time: The reasonable/necessary measures to increase or preserve the property’s value which require the consent of all or a major- ity of the owners should be completed, if possible, before new owners are involved in voting procedures after the sale of the first apartment(s). Experience has shown that apparently reasonable projects are often difficult to accomplish, which can make the sale of additional apartments more difficult or appreciably reduce realisable prices. Typical examples are the installation of an elevator, approvals for balcony construction, facade refurbish- ment, and the inclusion of a possible loft extension in the utilisable value appraisal.
construction but, above all, the historical stock of investment properties. Following the postponement and subsequent cap of indexing in 2022, this latest legal intervention prevents the adjustment of rents and sustainably damages property rental as a business model. Announcements
The ultimate way out of the jungle created by the Austrian Tenancy Act – and an obvious strategy – is the separation and sale of individual units to owner-occupiers.
by various politicians of further tougher restrictions in the future is also encourag- ing investors to seek alternatives. The ultimate way out of the jungle created by the Austrian Tenancy Act (“Mietrechts- gesetz”) – and an obvious strategy – is the separation and sale of individual units to owner-occupiers. However, this is not
Rented apartments: Apartments with (open-ended) leases are, as a rule, difficult to sell and require sub- stantial price discounts. Terminating the lease is a possibility when an apartment is rented but no longer used as a primary residence by the tenant or other eligible person. An amical solution, generally in
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Investment Property Report
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