Peculiarities of purchasing property in Austria

Specific steps to buying real estate property in Austria

There are some restrictions on the manner in which foreign nationals can purchase and possess real estate in Austria. Indeed, historically there were some more significant steps that a foreign national had to undertake in order to be able to buy and own real estate in the country. However, in recent years, there has been a general relaxation in regard to the laws that govern foreign ownership of real estate in Austria.

The most significant changes and relaxations in the laws governing foreign ownership of real estate pertain to foreign nationals from the European Union nations. Simply, since the formation of the EU and since Austria's reception into the EU, any foreign national within the EU can purchase real estate in Austria with ease. Indeed, for all practical purposes, at this juncture, a citizen from the EU stands in essentially the same position that a citizen of Austria stands when it comes to the purchase and ownership of real estate in that country.

When it comes to foreign nationals from non-EU nations, there remains one rather significant restriction on the ability of these foreigners to buy and own real estate in Austria. In short, before a foreign national from an non-EU can purchase real estate in Austria, that person must obtain permission from the local authority office in the locality in which the foreign national desires to make the purchase of real estate.

Generally speaking, approval from the local authority is easy to come by and will be granted in the vast majority of instances. Additionally, this approval normally is forthcoming in a very short amount of time.

Once a foreign national has identified a piece of real estate that he or she is interested in purchasing, an oral offer is made to the seller. If the seller accepts the offer - or, if the seller puts forth a counteroffer that is acceptable as such to the buyer - a purchase agreement is prepared. In Austria, more often than not, a solicitor or lawyer handles the affairs associated with the buying and selling or real estate.

As a matter of normal routine, the buyer will post a deposit in the amount of 10% at the time the purchase agreement is executed. The deposit will be held in escrow, pending the completing of the sales transaction itself. If the sale falls apart through no fault of the buyer, the buyer will have his or her deposit returned.

When the completion date rolls around, the seller will be responsible for making certain that all contract provisions that apply to him or her have been satisfied. More often than not this primarily includes making certain that the property is free from any encumbrances that might interfere or impede the conveyance of the real estate to the buyer.

At the time of the completion date, the buyer will need to have his or her financing in place and in order. At the time set for the completion of the transaction, the buyer will pay the remaining balance due and owing on the purchase agreement. Once this payment is made, ownership of the real estate will transfer by operation of Austrian law to the buyer. However, the new ownership of the real estate - the ownership of the buyer in the real property - will need to be registered with the Austrian Land Registry.

The process of fully registering the real estate with Austrian Lad Registry can take up to three or four months in some instances. It is not a quick process, more often than not.

When it comes to obtaining financing for the purchase of real estate in Austria, Austrian banks generally will lend money to citizens of that country and foreign nationals alike.

Property Abroad always recommends using a Solicitor or Lawyer

Fees

The total cost of a property is likely to be between 10 - 11% greater than the purchase price, when all fees (including mortgage fees) are included. This comprises land purchase tax, land registry entry, estate agent's commission (estate agents' fees (3.6%) are set by law) and notary fees.
If you require a mortgage, you should allow up to approximately 5% covering all bank and notary charges. Mortgages are currently cheaper in Austria than in the UK and are available in Euros or Swiss Francs.
It costs around an additional 500? to have the contract translated into English.

The figures below may vary and include 20% VAT.
• 3.0% Estate Agents Fee
• 3.5% Real Estate Transaction Tax
• 1.0% Land Registry Fee
• 3.0% Lawyer/Legal Fees

The estate agent fees are paid by both seller and purchaser and along with the land registry and legal fee are controlled by.