Buying your own home in Vienna: dream or unfulfillable wish?

Buying your own home in Vienna: dream or unfulfillable wish?

Buying a home remains a significant challenge for many households, especially in Vienna. In June 2025, an average dual-earner couple would have to spend 53% of their net income to repay the loan for a 90 m² new apartment. This burden is evident despite an improvement compared to the previous year, when 61% of income was still required, reports vienna.at.

The Financial Market Authority (FMA) has recommended an upper limit of a maximum of 40% of income for a sustainable debt service ratio, but many banks have only made limited use of this regulation. This is in contrast to high property prices, which continue to be a pressing problem. In addition, interest rate cuts by the European Central Bank (ECB) have eased, further complicating the situation for those seeking credit.

Criticism of the regulations and the FMA

The KIM regulation, which regulates lending and has no longer been legally binding since the end of June 2025, stipulated that banks must require an equity share of at least 20% and a debt service ratio of a maximum of 40%. Interestingly, before this regulation came into force, 90% of loans granted did not meet the criteria. Despite the time restrictions, around 87% of new loans granted in the second half of 2024 met the KIM criteria. Nevertheless, both banks and politicians, including representatives such as Reinhard Langthaler and Johannes Wild, criticize the FMA, while FMA boss Helmut Ettl refers to recommendations since 2016.

A significant volume of unused exceptions, amounting to around 600 million euros, shows that the KIM Regulation is not the limiting factor for lending. Many banks have therefore used less than half of their exemption quota.

Recommendations for borrowers

In order to be better prepared in the current situation of rising interest rates and inflation rates, the Financial Market Stability Board (FMSG) recommends using fixed interest models in the coming loan negotiations. In April 2025, 1,577 million euros of new loans were granted, with 88% offered at fixed interest rates and only 12% at variable interest rates. The fixed interest rate share has increased in recent years and has been over 75% of new loans since mid-2023, as [fmsg.at](https://www.fmsg.at/publikationen/risk notices-and-recommendations/2023/recommendation-fmsg-1-2023.html) reports.

The situation on the real estate loan market has improved since the introduction of the KIM Regulation, but remains challenging. In particular, the increase in loans with variable interest rates since mid-2022 highlights the growing risks for borrowers.

Future outlook and risks

Anticipatory preparation for possible future scenarios is crucial. This includes interest rate increases, economic downturns, and potential loan defaults. A current one Deloitte white paper points out the importance of being able to meet these challenges with tailor-made solutions. Workshops to discuss specific risks and actions are also available to support both the real estate and financial sectors.