Published on and written by Cyril Jarnias
The Austrian residential market is undergoing a correction after more than a decade of almost uninterrupted growth. Prices, however, remain high, and the price gaps between cities have never been so pronounced. Between Innsbruck, Vienna, Salzburg, Graz, and Linz, the cost per square meter for comparable properties can be double or even triple.
Price disparities in Austrian real estate markets are explained by several key factors: economic dynamism, demographic pressure, tourism activity, housing policy, as well as geographical and regulatory constraints. A comparative analysis of the main urban markets can be established using data from the OeNB central bank, Statistik Austria, and several private observatories.
A national market in a correction phase, but still expensive
In 2024, the national housing price index fell by 1.08% in the fourth quarter compared to the previous year, following a 2.35% drop a year earlier. For the full year, the nominal decline reached just over 2%, and nearly 3% in real terms once inflation is accounted for. This marks the seventh consecutive annual decline, an unprecedented phenomenon for a long time in a country considered one of Europe’s most stable markets.
Increase in nationwide residential prices between 2005 and the first quarter of 2023
Current forecasts lean more towards stabilization than a true reversal: most scenarios suggest a variation between 0% and +1% in 2025, followed by a moderate recovery of 1% to 2% per year starting in 2026. In this context, interest is shifting towards intra-national disparities, i.e., a detailed comparison between cities and regions.
Austria, a country of renters… but not everywhere
The occupancy structure directly impacts prices and yields. Approximately 54.3% of Austrian households are homeowners, a rate significantly below the European Union average (over 70%). Conversely, the rental market is massive: nearly 1.8 million dwellings were rented in the third quarter of 2024, representing over 40% of primary residences.
The example of Vienna, where about 75% of households are renters and two-thirds of residents live in municipal or subsidized housing, contrasts with rural states like Burgenland, where the homeownership rate is close to 70%. This structural difference explains the housing affordability gaps between regions.
The average national rent reached 9.4 euros per square meter in early 2025 (9.9 euros in the third quarter of 2024), with strong disparities: Salzburg, Tyrol, and Vorarlberg dominate, while Burgenland, Carinthia, and Styria have the lowest rents. These gaps directly affect sale prices and gross yields.
Regional hierarchy: Where do cities stand on the price scale?
Data by federal state (Land) provides a useful first framework before delving into city-by-city detail. For the same type of property – a 150 m² house – the average price gap is spectacular.
Average prices for a 150 m² house by region
| Region | Average Price 150 m² House (€) | Average Price per m² (€) |
|---|---|---|
| Tyrol | 1,074,519 | 7,163 |
| Vienna | 962,144 | 6,414 |
| Salzburg | 868,421 | 5,789 |
| Vorarlberg | 825,000 | 5,500 |
| Lower Austria | 538,400 | ≈ 3,590 |
| Upper Austria | 497,144 | ≈ 3,315 |
| Styria | 474,375 | 3,163 |
| Carinthia | 454,592 | ≈ 3,030 |
| Burgenland | 363,480 | 2,423 |
Tyrol dominates clearly, ahead of Vienna and Salzburg, while Burgenland is at the bottom with values almost three times lower than Tyrol. Within these regions, certain urban markets show even higher levels than the regional average, particularly Innsbruck, Salzburg city, and some districts of Vienna.
Vienna: The expensive but heterogeneous capital
Vienna alone concentrates over 23% of the country’s primary housing stock and stands as the reference market. The price index there fell by 2.08% in 2024 (nearly 4% in real terms), continuing a decline that began in mid-2023. However, this must be placed in a long-term trend: since 2003, prices have more than doubled, with an increase of 210% between 2005 and 2023.
The average price for a 150 m² house is around 962,000 euros, or just over 6,400 euros per square meter. For apartments, figures vary greatly by location and segment, but a general order of magnitude for the city as a whole for new or well-located properties is around 5,500 to 7,000 euros per square meter.
Extreme disparities between districts
The price map of Vienna resembles a gradient that decreases as one moves away from the historic center. The Innere Stadt (1st district) is in a league of its own, with prices rivaling the most expensive neighborhoods in Europe.
| District / Type | Average Price per m² (€) | Indicative Range (€ / m²) |
|---|---|---|
| Innere Stadt (1st) | ≈ 24,977 | 25,000 – 30,000 (exceptional) |
| Upscale neighborhoods (13th, 18th, 19th) | 6,400 – 8,500 | 7,600 – 7,900 (recent average) |
| Extended center (2nd–9th) | ≈ 5,500 – 9,500 | varies by district |
| Favoriten, Simmering, Floridsdorf (10th, 11th, 21st) | ≈ 5,000 – 5,200 | min ≈ 3,000 in Simmering |
| Affordable periphery (21st, 22nd) | 3,500 – 5,000 | development areas |
In the Innere Stadt, apartments traded at an average of around 24,977 euros per square meter in early 2025, with potential peaks of 30,000 euros/m² for exceptional properties. At the opposite end, some industrial or peripheral sectors like Simmering remain the most affordable, with a historical floor around 3,000 euros/m² for older stock and slightly more for newer properties.
Rental yields: From very low to decent depending on the area
With approximately 75% renters, Vienna has a deep rental market. Gross yields vary significantly between the highly valued center and the more popular or developing districts.
| Vienna Area | Average Gross Rental Yield |
|---|---|
| Innere Stadt (1st) | 1.14% – 1.82% |
| All of Vienna | 4.12% (average Q1 2025) |
| Affordable residential districts (Donaustadt, Floridsdorf, Favoriten, etc.) | 2.38% – 6.87% |
In the historic center, the very high land valuation suppresses yields, which barely exceed 1%. Conversely, peripheral or transforming districts (Favoriten, Donaustadt, Floridsdorf) can offer gross yields above 4%, sometimes close to 6–7% for targeted products.
Vienna compared to other major cities: Price level and affordability
Compared to other European capitals like Paris, Luxembourg, or Munich, Vienna remains slightly behind in terms of new construction prices (around 6,432 €/m² versus over 10,000 €/m² in Paris or Munich). However, its level is significantly higher than that of Austria’s second-tier cities, resulting in a clear hierarchy within the country.
The city’s population is projected to increase by about 310,000 residents by 2053, reaching nearly 2.3 million inhabitants. This strong demographic pressure limits the potential for long-term price declines, with an expectation of a return to annual growth of 3% to 6% around 2026.
Salzburg: Expensive city, record rents, and a market under tourist pressure
Salzburg holds a special place on the Austrian map: it is both a major tourist destination, a residential market constrained by UNESCO (protected historic center), and one of the places where the square meter reaches peaks.
For a 150 m² house, the average price in the state of Salzburg is around 868,000 euros, or nearly 5,800 euros/m². But in practice, within the city itself, the market is tighter and more expensive.
In February 2025, the average price per square meter for houses in the city was €9,860, up over 4% year-on-year for this segment.
The most expensive rental market in Austria
Salzburg holds the national record for residential rents: approximately 11.3 euros per square meter on average, significantly more than Vienna. Detailed data shows a sharp rise in rents between 2023 and 2024.
| Rental Indicator in Salzburg | Approximate Value |
|---|---|
| Average rent per m² (all sizes) | ≈ 18.30 €/m² |
| Premium rent per m² | up to 23.30 €/m² |
| Rent in more affordable areas | from 14.10 €/m² |
| Average rent for a 60 m² apartment (2024) | ≈ 17.35 €/m² |
For a 60 m² apartment, the average rent climbed from about 15.48 €/m² to 17.35 €/m² in one year, representing a rise of around 12%. In parallel, gross yields on apartments average around 3.66%, with a range from 3.18% to 4.25% depending on location.
Role of tourism and regulation
The city and region rely heavily on tourism (Salzburg Festival, ski resorts, the neighboring Salzkammergut). This activity boosts demand for second homes and short-term rentals, increasing pressure on the conventional residential supply. Seasonal rentals can generate much higher yields, at the cost of stricter regulation, particularly to limit the conversion of standard housing into tourist accommodations.
The average price per square meter for an apartment in the Salzkammergut region in 2023 was about €4,800.
Graz: Strong price surge but still at an intermediate level
Capital of Styria and the country’s second-largest city, Graz has long been seen as a more affordable alternative to Vienna. This image remains partly true, but the gap is narrowing quickly. In February 2025, the average house price there reached 5,491 euros per square meter, a spectacular increase of 44.6% year-on-year for this segment.
In the apartment market, recent transactions and developer data indicate prices in the range of 4,000 to 5,000 €/m² for new builds in the city, with a previous average around 4,450 €/m² in the third quarter of 2023. The price per square meter for new constructions was about 3,838 €/m², still showing a slight differential between new developments and more central resales.
A market largely driven by rentals
Graz is a major university city, with over 30,000 students at the University of Graz alone. This student, and more broadly young population, supports a very dynamic rental market.
The average gross yields for apartments generally range between 2.7% and 3.6%. These yields vary according to property size: two-bedroom apartments (T2), particularly in highly sought-after neighborhoods like Lend, can exceed 4%. This performance is explained by strong demographic dynamics, illustrated by the population growth of the Lend district, which increased from about 27,800 to nearly 33,800 residents in about a dozen years.
| Indicator in Graz | Approximate Value |
|---|---|
| Average house price (Feb. 2025) | 5,491 €/m² |
| Average apartment price (Q3 2023) | ≈ 4,450 €/m² |
| New build price (development) | ≈ 3,838 €/m² |
| Average gross yield (apartments) | 2.7% – 3.6% |
Compared to Vienna and Salzburg, Graz thus appears as a compromise: still moderate prices for a large city, but rapid growth, especially in the last two years. For an investor, the bet is to bank on the continuation of this upgrading while accepting yields a bit below the national average.
Linz: An industrial and tertiary market on a strong upward trend
Third-largest city in the country, Linz benefits from marked economic growth, especially in tech and industry, with players like Dynatrace or Runtastic. This dynamism has translated into a clear rise in property values: prices for apartments and condominiums have increased by about 10 to 12% in some recent periods, and average house prices have risen by about 8.4% year-on-year.
The average house price in Salzburg is about €5,060/m², significantly higher than regional averages.
| Indicator in Linz | Approximate Value |
|---|---|
| Average house price | ≈ 5,060 €/m² |
| New construction price (2023 data) | ≈ 4,579 €/m² |
| Average gross rental yield (apartments) | ≈ 4% |
Linz is among the cities with the strongest price increase since 2016 (over 30% cumulative). In terms of rents, the city remains a bit cheaper than Salzburg or Vienna, but the gap is narrowing, especially for small units close to the center.
Innsbruck: The most expensive of the major cities
Innsbruck, the capital of Tyrol, is consistently ranked as the most expensive city for buying an apartment in Austria. Already in 2023, the average apartment price there exceeded 7,600 €/m², far more than Vienna or Salzburg based on their urban averages.
The maximum observed price for luxury apartments in Monaco reached nearly €10,851 per square meter.
This expensiveness is due to several structural factors: alpine topography limiting land availability, status as a regional capital, university role (nearly 28,000 students), tourist appeal in both winter and summer. The rental market offers yields averaging around 4–4.3%, with higher potential for short-term rentals in some well-located neighborhoods.
For an investor, Innsbruck is closer to a “premium mountain resort” market than a classic mid-sized city: very high entry ticket, but strong resilience in demand and sustained long-term appreciation.
Burgenland, Styria, Carinthia: The “affordable” side of Austria
In contrast to the Alpine markets and Vienna, some federal states still show prices well below the national average.
In Burgenland, the cheapest region in the country, a 150 m² house costs on average around 363,000 euros (approximately 2,423 €/m²). Apartments trade at a median price around 1,900 €/m². Even though prices there fell by about 5% on existing stock in 2023, the region is starting to attract households seeking a compromise between low prices and proximity to Vienna, particularly in districts close to the capital.
In Styria, outside Graz, median prices are about €2,400/m² for houses and just under €2,700/m² for apartments. A moderate decline of about 2.2% was observed in 2024, correcting previous increases. Rents, among the lowest in Austria, limit rental yields but improve housing affordability for residents.
In Carinthia, the median house price is around 2,460 €/m², with demand concentrated on lake areas (Wörthersee) and the regional capital Klagenfurt. However, some prestige properties on the shores of Wörthersee can reach price levels comparable to the most expensive ski resorts or high-end neighborhoods in Vienna.
Comparing major cities: Price per square meter and yields
To better situate the major urban centers relative to each other, it is useful to juxtapose their price levels and average rental yields for apartments.
Average prices per m² (houses or apartments based on main sources)
| City | Main type (reference) | Average price per m² (€) |
|---|---|---|
| Innsbruck | Apartments | ≈ 7,650 |
| Vienna | Houses (150 m²) | ≈ 6,414 |
| Salzburg | City houses | ≈ 9,860 (2025 listing) |
| Graz | Houses (Feb. 2025) | 5,491 |
| Linz | Houses | 5,060 |
Several insights emerge. Strictly speaking, Innsbruck remains the most expensive city for apartments based on observed prices, but Salzburg can exceed these levels in some very tight segments (central houses, premium properties). Vienna comes just behind, with a very heterogeneous price structure. Graz and Linz form a second, more affordable tier but with strong growth.
Average gross rental yields by major city
| City | Average Gross Rental Yield (apartments) |
|---|---|
| Vienna | ≈ 4.12% – 4.60% |
| Salzburg | ≈ 3.66% (city); 3–4% long-term |
| Graz | ≈ 2.7% – 3.76% |
| Linz | ≈ 4% |
| Innsbruck | ≈ 4% – 4.3% |
| National average | ≈ 3.5% |
The most expensive cities are not necessarily those offering the best yields. Vienna (outside the hyper-center) and Linz stand out with yields often above the national average, while Salzburg and Graz are slightly below, especially for highly sought-after properties.
In cities like Salzburg or Innsbruck, seasonal (short-term) rentals can offer double-digit gross yields. However, these investments come with greater volatility and are subject to specific regulatory regimes, unlike long-term rentals.
Why such large gaps between cities?
Several factors explain the price dispersion among major Austrian cities.
The first dimension is geographical: Tyrol, Vorarlberg, and part of Salzburg are alpine regions where buildable land remains scarce and often constrained by topography and regulation. Conversely, Styria, Lower Austria, or Burgenland have vast plains, allowing for more extensive development and lower land costs.
The second relates to economic and demographic structure. Vienna, Innsbruck, Linz, and Graz concentrate skilled jobs, universities, services, and infrastructure, attracting a growing population, often young and mobile. Vienna, in particular, stands out with a GDP per capita near 60,000 euros, well above the average of other states, and strong migratory inflow.
Tourism in the Austrian Alps (ski resorts, lake regions, historic centers) generates strong international demand for second homes and investment properties. Despite local legislation aimed at protecting permanent residents, price pressure remains high in the most sought-after areas.
Finally, housing policy plays a major role, especially in Vienna. The vast stock of social and subsidized housing, which accounts for over half of the city’s primary residences, mechanically moderates rents for a large portion of the market but contributes to concentrating price increases on the free private segment, particularly in high-demand neighborhoods.
A market constrained by credit and construction
The ongoing correction is not solely due to local factors. It is also a direct consequence of the interest rate shock. The average rate for new mortgage loans rose from about 2.86% two years ago to 4.16% at the end of 2023, before receding to 3.63% in December 2024. The KIM-VO prudential rules, effectively requiring a 20% down payment and limiting the debt service ratio to 40% of income, have also dampened demand.
New housing loans fell to €11.33 billion in 2024, less than half the volumes of 2021 and 2022.
On the supply side, the situation is equally tight. Building permits fell by nearly 5% in the first nine months of 2024, following sharp declines already in 2022 and 2023. The number of completed dwellings has also decreased, while cities continue to gain inhabitants. This dual “less credit, declining construction” situation limits the depth of the price correction, especially in urban areas where structural demand remains strong.
What are the prospects for the coming years by city?
Projections converge towards a scenario of stabilization followed by a moderate recovery. For 2025, most analyses anticipate largely stable prices, even a slight increase of 0 to 1%. Starting in 2026, the recovery could be between 1 and 2% per year, and higher in certain segments or territories.
In the long term, metropolitan areas are expected to outperform rural ones. Vienna, despite a recent correction, could see annual growth return to 3–6% around 2026, supported by demographic growth and a persistently low supply of new housing. Graz and Linz, driven by their economic boom, are likely to continue narrowing the price gap with the capital.
In the Alpine regions, Tyrol and Salzburg should maintain high price levels, with expected increases of 3 to 4% in the most sought-after tourist areas. Conversely, Burgenland, rural Styria, and Carinthia could experience a softer trend, or even occasional declines in sectors with demographic decline.
How to interpret these comparisons for a buyer or investor?
Comparing prices between cities in Austria is not just about a simple ranking from most to least expensive per square meter. Three dimensions deserve simultaneous examination.
The first is obvious: the absolute price level. Innsbruck, central Salzburg, and some Viennese districts (Innere Stadt, Döbling, Hietzing) belong to the top tier in Europe. Graz, Linz, or Klagenfurt remain more accessible, as do large parts of Styria and Burgenland. For a household looking to buy their primary residence, this criterion is decisive, especially since credit regulation now imposes a substantial minimum down payment.
Gross rental yields vary by city and neighborhood. Areas like ‘average’ Vienna, Linz, or some peripheral districts of the capital offer attractive yields of around 4% for classic residential properties, with a good risk/return balance. Hyper-centers (like Vienna’s Innere Stadt, Salzburg’s Altstadt, or Kitzbühel) typically generate lower yields for higher risk, except in the case of high-end tourist rentals. Graz and Salzburg show yields slightly below the national average, but this weakness can be offset by favorable property price momentum.
The third dimension is that of outlook: long-term growth, economic stability, regulation. In this respect, Vienna appears as a central market, heavily regulated but supported by solid fundamentals. University and industrial cities (Graz, Linz, Innsbruck) benefit from a resilient demand base. Alpine tourist regions remain very cyclical, with a mix of high prices, strong regulatory constraints, and potentially high yields in the short term.
Ultimately, comparing real estate prices between cities in Austria paints a contrasting landscape: an expensive and pressured mountainous west, a central capital that remains costly but regulated, and a more affordable east, still in transition. In a context where price correction seems limited by scarce supply and the gradual return of investors, the key for both buyers and investors will be less about betting on a major overall decline and more about precisely choosing the city, neighborhood, and segment suited to their objectives.
A French business owner, around 50 years old, with a well-structured financial portfolio already in Europe, wanted to diversify part of his capital into residential real estate in Austria to seek rental yield and exposure to the euro in a different tax framework. Allocated budget: €400,000 to €600,000, without using credit.
After analyzing several markets (Vienna, Graz, Linz), the chosen strategy consisted of targeting a quality apartment in an up-and-coming neighborhood in Vienna or Graz, combining a target gross rental yield of 4 to 5% – “the higher the yield, the greater the risk” – and potential for medium-term appreciation, with an overall ticket (acquisition + fees + potential renovations) of around €500,000.
The mission included: market and neighborhood selection, introduction and handling by a local network (real estate agent, lawyer, tax advisor), choice of the most suitable investment structure (direct ownership or Austrian civil partnership), and definition of a diversification plan over time, incorporating French-Austrian tax specificities.
Disclaimer: The information provided on this website is for informational purposes only and does not constitute financial, legal, or professional advice. We encourage you to consult qualified experts before making any investment, real estate, or expatriation decisions. Although we strive to maintain up-to-date and accurate information, we do not guarantee the completeness, accuracy, or timeliness of the proposed content. As investment and expatriation involve risks, we disclaim any liability for potential losses or damages arising from the use of this site. Your use of this site confirms your acceptance of these terms and your understanding of the associated risks.
Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.
On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.
Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.
