After the most recent failed negotiations on a rental price cap, the benchmark rents for new contracts will rise sharply from today, April 1st. The reference value will therefore be highest in Vorarlberg.
With the increase in the reference values, inflation is now also affecting the relatively cheap apartments, said Michael Klien from Wifo on Friday, according to the Ö1 “Mittagsjournal”. Depending on the federal state, the guide values increase by 8.5 to 8.6 percent. According to the publication, the value from April was highest in Vorarlberg at EUR 10.25 per square meter, followed by Salzburg (9.22), Styria (9.21) and Tyrol (8.14).
The situation on the rental market is getting worse
Klien expects the increase in benchmark rents to exacerbate the situation on the rental market. On the one hand, property has become less affordable due to interest rate increases and stricter lending rules, and on the other hand, new construction is collapsing, so there will be less supply in the next few years. As a result, demand will again focus on the rental market, according to Klien.
Cities announce rental price brakes
The benchmark rent increase affects 274,000 private and 220,000 municipal rental apartments. Several cities have already announced that they will cushion the increase or not implement it at all for the apartments they own. In Graz, for example, rents for municipal housing are only to rise by 2 percent, while Innsbruck is considering something similar. There should also be rent brakes in Klagenfurt and Linz. According to economist Klien, this is a “sensible contribution to averting high inflation,” especially since low-income households would mostly live in municipal apartments and municipal buildings.
Most affected households are in Vienna. Here the increase will be carried out in full, but there will be a housing bonus for 650,000 households and a special credit for tenants in municipal buildings. There will be a one-time housing allowance nationwide.
