Lending in Austria: Real estate market is about to collapse!

Lending in Austria: Real estate market is about to collapse!

The decision of the financial market stability body to let the credit institutions-real estate financing measures regulation (KIM regulation) expire is classified by Gerald Gollenz, the chairman of the trade association of the real estate and wealth cuisor in Austria (WKÖ). This measure, which has severely restricted access to real estate loans in the past, could be the key to reviving the housing market. Gollenz explained that the excessive guidelines have significantly hindered the acquisition of residential property in Austria when lending. He pointed out that the decline in lending not only affected potential home buyers, but also had a serious effect on the new building, which is documented by the 1st Austrian new building report, which shows the alarming future forecasts for housing construction, such as wko.at reported.

engrave warnings for the construction industry

The forecasts are worrying: Gollenz warns that the completion numbers of newly built real estate could collapse by almost 80 percent by 2026, which would lead to a dramatic reduction in freely financed condominiums. It emphasizes the urgent need for further measures to boost residential construction, otherwise the numbers for new buildings from around 17,380 units could decrease to less than 1,793 - an alarming development that could plunge the entire construction industry into a severe crisis, as well as ots.at was highlighted.

Experts warn that the restrictive credit transfer guidelines, combined with inflation and misrepply in Price Developments, which could put up with real estate and construction industry from 2025. Michael Pisecky, chairman of the specialist group in Vienna, underlines that the range of new properties drops drastically, which will lead to massive price increases in the new construction segment. Gollenz has spoken a serious warning and demands rapid action by the government: "Without immediate measures, there is a severe crisis on the residential and living renovation market, which endangers thousands of jobs," says Gollenz. The real estate industry is therefore faced with a turning point at which crucial measures for stabilization are urgently required.