Yields have still not recovered The yield represents a decisive criterion for the valuation of a property under all income approaches. In spring 2025, the market yields at prime locations in the 1st District ranged from 2.25 to 2.5 percent and reached three per cent at good locations within the beltway. Peripheral and less attrac- tive locations, in contrast, produced
values up to five per cent. A remarkable fact is that yields have not declined nota- bly since 2024 even though key interest rates, bond yields and refence rates like the Euribor have fallen substantially over the past 12 months. This is chiefly a result of the banks’ refusal to pass on even a limited share of these reductions to their customers
because of increasing risk premiums and margins. However, a continuation of the downward trend in interest rates can also be expected to trigger a decline in market yields over the coming months and, in turn, will be included in valua- tions.
The situation at above-average locations is somewhat different: In good locations, the square metre price is the focal point of attention. This can be interpreted as a
want to build up attractive portfolios. For these potential buyers, the current market situation is an excellent entry opportunity.
criterion in the Inner City. The same also applies to micro-locations in more outlying areas like Währing or Döbling. The rental yield, in contrast, will clearly dominate as a comparative criterion at less prestigious locations on the city outskirts.
typical feature of a market in recovery. The fact that yields are no longer the primary or only value-determining criteria in these submarkets is a sign that the low point has passed. The greater attention given to square metre prices in valuation is justified for two reasons in good locations: On the one hand, the sale of
Specifically, this means the following for Vienna: Square metre prices are once again an important criterion for the comparative transactions used to value investment properties at central locations.
condominiums is a realistic business model and lower purchase prices combined with nearly constant selling prices lead to higher margins. On the other hand, these are the preferred investment locations for high net worth companies and family offices that
Specifically, this means the following for Vienna: Square metre prices are once again an important criterion for the comparative transactions used to value investment properties at central locations inside the beltway – and nearly the only
Vienna | 2025
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