Measures in check

Housing package: how almost everyone gets money from the state

Countries will be able to grant loans at 1.5 percent interest to fulfill the dream of home ownership.

(Bild: Volodymyr Shevchuk - stock.adobe.com)

The government is investing no less than 2.2 billion euros in a major housing package until 2026. House builders will receive cheap loans, tenants a tradesman's bonus, landlords renovation subsidies and tax concessions. This is intended to boost new construction - and above all create more affordable living space.

The government wants to rescue the ailing construction industry with a surprisingly large package and, above all, create more urgently needed affordable housing. A total of 2.2 billion euros is to be provided by 2026 - "very well invested money, because the economic effects are enormous", says Finance Minister Magnus Brunner (ÖVP), explaining his generosity.

Provinces will be able to grant loans at 1.5 percent interest to fulfill the dream of home ownership.

(Bild: Volodymyr Shevchuk - stock.adobe.com)

Countries should make cheap loans possible
Many people are set to benefit across the board. Home builders are to receive more and cheaper subsidized loans from the federal states. Up to 200,000 euros are possible per application, for which an interest rate of just 1.5 percent is charged. The federal states receive the money via the Federal Financing Agency, while the state adds the difference to the market interest rate. Example: Compared to a current fixed bank loan of €200,000, the monthly installment drops from around €900 to €600, according to Christoph Kirchmair from credit advisor Infina.

(Bild: stock.adobe, Krone KREATIV)

Who should benefit from the housing package and how

• With one billion euros, non-profit housing developers(cooperatives) are to build 10,000 subsidized rental and owner-occupied apartments and renovate a further 5,000.

• The housing umbrella for tenants (as protection against evictions or high energy back payments etc.) will be more than doubled this year from €60 million to €125 million.

• Private individuals will receive a craftsmen's bonus for building, renovating and maintaining their homes. Costs of up to €10,000 will be reimbursed by 20 percent. However, as with the other points, it is still unclear when this applies, i.e. when a tradesman's invoice should be issued and submitted.

• This year and in 2025,landlords will receive an additional 15 percent of the costs of replacing heating systems or thermal insulation as a renovation bonus. This will increase the subsidy rate for them to up to 60 percent. Tax write-offs for landlords will be tripled if eco-criteria are met. This is intended to encourage investment.

• Home buyers save on land registry and lien fees for the first home purchase (construction, purchase up to €500,000). This brings up to €11,500 per case. If the purchase price or construction costs exceed €500,000, the two fees for the excess amount must be paid pro rata. In the case of "luxury apartments" costing over €2 million, there are no savings at all and the fees must be paid in full.

Vacancy levy to be possible in future
The plan to allow the federal states to levy high charges for vacant housing in future is controversial. This is intended to bring additional apartments onto the market. At present, this vacancy tax is only possible to a limited extent under constitutional law and the amount is therefore low. This is to change in future, but still needs the approval of the SPÖ in parliament. According to statistics, there were 653,000 properties without registered residents across Austria in 2021.