Step-by-step guide to buying property in Austria
Elizabeth Bagwell, Saturday, 25 January 2014
This article is part of a series of 8 articles about buying property in Austria. The other articles in the series cover the following topics:
Buying property in Austria is straightforward, whether you're a resident Austrian citizen or an international investor. There are no restrictions on international property investment. While individual towns and villages have the right to place restrictions on, for example, the number of second homes or holiday properties in their area, in practice very few do.
Typically, buying a property will follow the following steps:
As in most EU countries, online property portals are coming to dominate the market, making it easy to explore the options in the regions you're considering before you make a trip out there. In Austria, estate agents are typically hired and paid by the seller, and should be assumed to have their best interests at heart. However, it is still possible to hire a search agent, and some agencies specialise in assisting international buyers to find appropriate properties. They tend to focus on luxury holiday or second home properties, and their fees may be higher than average. Austrian estate agencies are often small and focussed on a narrow geographical area so don't be ready to contact several agents, particularly if you are considering properties in several disparate areas.
Arranging a mortgage
As an international buyer, you can choose to arrange a mortgage in your home country or in Austria. In either case, you should arrange a mortgage in principle (a document describing the amount of money the mortgage provider would, theoretically, be willing to lend you) before making an offer.
Even when the interest rates are similar, mortgage providers in each country tend to offer different products. Don't be surprised if you can't match an offer you've seen at home, or in fact find the same type of mortgage.
Negotiating a price
Expect to make your offer in writing to the estate agent acting for the seller. As the buyer, you will be responsible for making your offers and counter offers, unless you've hired an estate agent or a lawyer to do so on your behalf. Apart from the estate agent's fees, costs are typically paid by the buyer. This is not fixed in law, but is simply a matter of tradition.
Structural surveys may be undertaken as part of this negotiation, however they are not standard. An Austrian mortgage provider may require a valuation survey, but will usually not require a structural survey. Sellers are not legally required to list all the defects in a property and may, in fact, not be aware of them. As the buyer, it is therefore advisable to pay an architect or surveyor to undertake a survey on your behalf. They may also be able to provide the report required by your mortgage provider, saving time and money.
Signing an agreement to buy
All contracts should be drawn up by a lawyer or notary. The agreement to buy is not the final sale and does not transfer the property, but it will usually tie both buyer and seller into an agreement. At this point, the price will be set. Typically, the buyer will pay a deposit, often 10% of the purchase price of the property, to the lawyer or notary who drew up the contract, who will hold it in escrow.
At this point, it's important to ensure that the terms under which the contract can be broken are agreeable to both parties. The buyer will want to withdraw if they cannot get a mortgage, or renegotiate the price if significant repairs are found to be required. Even if you speak German fluently, it is recommended that you get a lawyer or notary acting for you to read the contract and explain it to you, ideally in your own language. This should be someone you pay, and who is acting solely for you and not for the buyer.
The contract must be signed in the presence of a notary, who will charge a fixed fee for their time. The costs will usually be covered by the buyer, who will also select the notary. You can find notaries in Austria at and the site is available in English. Embassy websites also typically provide lists of Austrian notaries and lawyers who speak their language. You can find out more about .
Finalising your mortgage
Before you can finalise the details of your mortgage and sign the mortgage agreement, you will need to have signed the agreement to buy. If you already have a mortgage in principle, the final agreement should be a matter of form. Contracts will usually be signed in the presence of a notary, hired by the bank. Find out more about or read our outline of .
Signing the contract of sale
The contract of sale transfers the ownership of the property. It must be signed in the presence of a notary or appropriate court official. Notaries charge a fixed fee for witnessing the signatures, typically EUR 120 per signatory. Some notaries offer additional services, such as registering the property and paying the property tax. If so, they will charge for this service.
Once the contract is signed, the property must be registered and property tax must be paid. It is the responsibility of the buyer to ensure this is done. The purchase price must also now be paid in full. This will typically either be done by transferring funds to a pre-arranged account managed by the notary. The notary will then release the funds to the buyer once the property has been registered, proving that the new owner has free and clear title.
Taking ownership of the property
Property ownership is usually transferred at the moment the sale contract is signed, but there may be a delay of some days while the property is registered and the funds transferred. Ensure that you get as complete information as possible at this time, ideally including historic utility bills, any warranty information (such as for recent building work) and local council tax information. You should also ensure you have tenancy agreements for any ongoing tenancies and resident's association information or liability for shared facilities, although this last usually only applies to apartment buildings.
Paying taxes
Once you've signed the sale agreement and officially own the property, you have up to 2 months to pay the property transfer tax, typically 3.5% of the sale price, and register the payment. This can be one online. You should receive a certificate indicating you've paid. There may also be ongoing taxes relating to the property, and you will usually have to pay taxes when the property is sold. .
This article is part of a series of 8 articles about buying property in Austria. The other articles in the series cover the following topics:
Buying property in Austria is straightforward, whether you're a resident Austrian citizen or an international investor. There are no restrictions on international property investment. While individual towns and villages have the right to place restrictions on, for example, the number of second homes or holiday properties in their area, in practice very few do.
Typically, buying a property will follow the following steps:
- Finding a property
- Arranging a mortgage (if necessary)
- Negotiating a price
- Signing an agreement to buy
- Finalising your mortgage (if necessary)
- Signing the contract of sale
- Taking ownership of the property
- Paying taxes
As in most EU countries, online property portals are coming to dominate the market, making it easy to explore the options in the regions you're considering before you make a trip out there. In Austria, estate agents are typically hired and paid by the seller, and should be assumed to have their best interests at heart. However, it is still possible to hire a search agent, and some agencies specialise in assisting international buyers to find appropriate properties. They tend to focus on luxury holiday or second home properties, and their fees may be higher than average. Austrian estate agencies are often small and focussed on a narrow geographical area so don't be ready to contact several agents, particularly if you are considering properties in several disparate areas.
Arranging a mortgage
As an international buyer, you can choose to arrange a mortgage in your home country or in Austria. In either case, you should arrange a mortgage in principle (a document describing the amount of money the mortgage provider would, theoretically, be willing to lend you) before making an offer.
Even when the interest rates are similar, mortgage providers in each country tend to offer different products. Don't be surprised if you can't match an offer you've seen at home, or in fact find the same type of mortgage.
Negotiating a price
Expect to make your offer in writing to the estate agent acting for the seller. As the buyer, you will be responsible for making your offers and counter offers, unless you've hired an estate agent or a lawyer to do so on your behalf. Apart from the estate agent's fees, costs are typically paid by the buyer. This is not fixed in law, but is simply a matter of tradition.
Structural surveys may be undertaken as part of this negotiation, however they are not standard. An Austrian mortgage provider may require a valuation survey, but will usually not require a structural survey. Sellers are not legally required to list all the defects in a property and may, in fact, not be aware of them. As the buyer, it is therefore advisable to pay an architect or surveyor to undertake a survey on your behalf. They may also be able to provide the report required by your mortgage provider, saving time and money.
Signing an agreement to buy
All contracts should be drawn up by a lawyer or notary. The agreement to buy is not the final sale and does not transfer the property, but it will usually tie both buyer and seller into an agreement. At this point, the price will be set. Typically, the buyer will pay a deposit, often 10% of the purchase price of the property, to the lawyer or notary who drew up the contract, who will hold it in escrow.
At this point, it's important to ensure that the terms under which the contract can be broken are agreeable to both parties. The buyer will want to withdraw if they cannot get a mortgage, or renegotiate the price if significant repairs are found to be required. Even if you speak German fluently, it is recommended that you get a lawyer or notary acting for you to read the contract and explain it to you, ideally in your own language. This should be someone you pay, and who is acting solely for you and not for the buyer.
The contract must be signed in the presence of a notary, who will charge a fixed fee for their time. The costs will usually be covered by the buyer, who will also select the notary. You can find notaries in Austria at and the site is available in English. Embassy websites also typically provide lists of Austrian notaries and lawyers who speak their language. You can find out more about .
Finalising your mortgage
Before you can finalise the details of your mortgage and sign the mortgage agreement, you will need to have signed the agreement to buy. If you already have a mortgage in principle, the final agreement should be a matter of form. Contracts will usually be signed in the presence of a notary, hired by the bank. Find out more about or read our outline of .
Signing the contract of sale
The contract of sale transfers the ownership of the property. It must be signed in the presence of a notary or appropriate court official. Notaries charge a fixed fee for witnessing the signatures, typically EUR 120 per signatory. Some notaries offer additional services, such as registering the property and paying the property tax. If so, they will charge for this service.
Once the contract is signed, the property must be registered and property tax must be paid. It is the responsibility of the buyer to ensure this is done. The purchase price must also now be paid in full. This will typically either be done by transferring funds to a pre-arranged account managed by the notary. The notary will then release the funds to the buyer once the property has been registered, proving that the new owner has free and clear title.
Taking ownership of the property
Property ownership is usually transferred at the moment the sale contract is signed, but there may be a delay of some days while the property is registered and the funds transferred. Ensure that you get as complete information as possible at this time, ideally including historic utility bills, any warranty information (such as for recent building work) and local council tax information. You should also ensure you have tenancy agreements for any ongoing tenancies and resident's association information or liability for shared facilities, although this last usually only applies to apartment buildings.
Paying taxes
Once you've signed the sale agreement and officially own the property, you have up to 2 months to pay the property transfer tax, typically 3.5% of the sale price, and register the payment. This can be one online. You should receive a certificate indicating you've paid. There may also be ongoing taxes relating to the property, and you will usually have to pay taxes when the property is sold. .
On our Dutch website Affidata.com you will find all types of property for sale in Austria by private sellers and estate agents. Find a property in the Austrian Alps, Tyrol, Innsbruck or Vienna.
Being prepared is half the battle, and that's even more true when dealing with the red tape of a foreign bureaucracy. The following guide describes the
different sets of documents required for each stage of the process of buying a property in Austria and applying for an Austrian mortgage. Read on to
find out more.