Preface
The sentiment – in other words, the prevailing mood – on relevant investment markets is regularly at odds with the rational analyses of opportunities and risks. This difference is, generally speaking, particu- larly evident at the end of a market cycle: Upward phases are dominated by excite- ment over potential profits, and the partly inflated entry prices are ignored. Downward phases, in contrast, are dominated by pessimism, and attractive opportunities frequently remain unnoticed. Vienna’s investment property market currently appears to be approaching the end of a downward cycle. After roughly three years of painful price declines for many market participants, square metre prices have again reached a level last seen more than ten years ago. The yield curve has risen in step with interest rates – and the rate cuts implemented by the ECB since last autumn have not yet triggered a yield compression. Yields currently reflect the summer 2024 level. One development is, however, evident: The rising interest rates which were primarily responsible for price declines have already
peaked. Key rates have been trending downward for nine months, and the tense situation surrounding other relevant pricing indicators like economic growth and inflation is also easing. A rational analysis of the relevant param- eters and the capital market environment definitely points to a near-term rebound of the Vienna investment property market. It is difficult to forecast whether prices will in- crease slightly or continue to decline in the coming months – but one thing is certain: The current, comparatively attractive price level offers opportunities for long-term value appreciation and interesting yields. Today’s challenging operating environment has led to considerable pressure in many areas. Investors with sufficient equity and liquidity who take an anticyclical approach can find opportunities that will presumably only reappear in the next cycle. Our experienced experts in the EHL investment property team can help you locate the real estate that perfectly matches your investment strategy.
Yours,
Michael Ehlmaier
Vienna | 2025
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