Challenge of housing costs: income rises, worries remain!

Challenge of housing costs: income rises, worries remain!

A current survey by the Ministry of Social Affairs, which was carried out by Statistics Austria and the Institute for Advanced Studies (IHS), shows a mixed picture of the income situation in Austria. Despite an improvement in financial conditions, a significant portion of the population reports serious challenges with housing costs. Overall, 15 percent of those surveyed see this as a major financial burden. This number remains stable compared to the previous quarter, but is five percentage points lower than last year, as Vienna.at reported.

In the fourth quarter of 2024, 40 percent of respondents said their income situation had improved compared to the previous year, while 21 percent suffered a loss of income. What is worrying is that around 10 percent of respondents, which equates to around 820,000 people, have difficulty making ends meet on their monthly income. This problem particularly affects people with low incomes and the unemployed, who are experiencing an increase in financial difficulties. According to the results, 33 percent of 18 to 74 year olds said they were having a harder time managing their household income.

Rising housing and energy costs

The main causes of the difficulties mentioned are the increased costs of food, housing and energy costs. The share of housing costs in disposable income in Germany in 2022 was 24.5 percent, while renter households had a burden of 27.1 percent. In addition, 11.9 percent of the population were affected by overburdened housing costs, with the highest burdens occurring among single-person households and single parents Federal Agency for Civic Education determines.

The average gross rent in Germany was 598 euros, which is made up of a net rent of 513 euros and additional costs of around 85 euros. Unfortunately, 5.1 percent of the population fell behind on rent or mortgage payments in 2022, while 6.7 percent could not afford to keep their homes adequately warm. These financial challenges are particularly severe for renter households.

Expectations for the future

Despite the increasing financial difficulties, Social Affairs Minister Korinna Schumann is optimistic and describes parts of the results as “the first, subtle silver lining on the horizon”. Nevertheless, one in five expects their household income to worsen in the next twelve months, which corresponds to the previous year's level. 68 percent of those surveyed expect the economic situation in Austria to worsen - an increase of 17 percent compared to the previous quarter. Only 7 percent are positive about the future.

In summary, the current survey shows that the population's financial challenges are serious despite a partially improved income situation. Rising housing costs represent a key issue for social justice and call for rapid and effective policy action. The data situation could be difficult to compare with the results of the older surveys, as new questions on housing cost calculations have been integrated into the microcensus since 2020, which capture the burdens on households with outstanding loans more precisely Destatis.