DeutschSelling a tenement house in Vienna requires being well prepared. As the owner of a multi-family house (tenement house) in Vienna, you are faced with a complex task that differs significantly from a usual property sale. In this blog article you will find out what makes a tenement house what special features the Viennese market has and how you can achieve a successful sale step by step. From the tenement house valuation to legal and tax aspects through to professional support – we provide a comprehensive overview so that you are well informed.
What is a tenement house?
A tenement house - also known as a rental house, income house or classic multi-family house - is a residential building with several residential units that are permanently assigned to tenants and regularly generate rental income (“interest”). The term comes from times past when rent was the common word for rent. Classically, a tenement house is primarily understood to mean old buildings, usually buildings from the Wilhelminian era (approx. 1840–1918) or before 1945, which were built as investment properties. Such tenement houses still shape the cityscape of Vienna today with their often historic facades and high old building rooms.
Nowadays, however, the term tenement house is defined more broadly: In principle, any residential building with several rented apartments can be called a tenement house - regardless of the year it was built. Buildings with municipal apartments or cooperative apartments are usually excluded, as these are publicly funded and do not primarily serve to optimize private income. For private owners, a tenement house means one thing above all: it is a property for investment, where the current rental income is the main focus.
Typical features of a tenement house: Many Viennese tenement houses are characterized by solid construction and historical details. High ceilings, double doors, stucco decorations and elegant old building elements are not uncommon. They often have 4 to 6 floors and a decorative street facade, sometimes with additional mezzanines (mezzanine, mezzanine), which were once added for tax reasons. There is often a business premises or commercial space on the ground floor, while the upper floors are used for residential purposes. Overall, due to their size and layout, tenement houses offer a considerable amount of living space, which ensures the owner regular income from rent.
Vienna as a special tenement house market
Vienna plays a special role in the tenement house market. On the one hand, the city has a long tradition of tenement houses: the historic Wilhelminian style districts in districts such as Mariahilf, new building, Josefstadt or Alsergrund consist largely of such old building tenement houses. This building structure shapes the cityscape and is popular with tenants - the flair of an old building apartment with herringbone parquet and double doors is still in demand. On the other hand, Vienna is interesting for investors because the demand and value of tenement houses have been increasing for years. However, private tenement house owners are becoming increasingly rare, as many properties have been resold in recent decades by institutional investors or through parification (division into condominiums).
So why is Vienna so special?
- Historischer old buildingbestand:Vienna has thousands of Wilhelminian style tenement houses, which are found in this density in hardly any other German-speaking city. Many are even under heritage protection, which means maintenance work, but also brings with it a special charm and a certain level of protection against structural changes by third parties.
- High demand with limited supply:Vienna's population is constantly growing and the housing market is tense. tenement houses are considered crisis-proof investments, which is why both Austrian and international investors are showing great interest. The continuously increasing demand has driven up the prices for Viennese tenement houses in recent years.
- tenancy lawliche Besonderheiten:A large part of the Viennese tenement houses are subject to the strict tenancy laws (MRG). Rent limits and protection against termination apply to old building apartments, which keeps rents comparatively low, but also results in stable rental income and low vacancies. This legal framework makes Vienna unique - and requires specialist knowledge from the owner, as the tenancy law is "only applicable to a limited extent" and contains many details.
- Stabile yield, moderates risk:Compared to other forms of investment, tenement houses in Vienna often offer moderate returns (due to the capped rents), but with a relatively low risk of default. The tenant structure is usually mixed and loss of rent is rare as living space is in high demand. For conservative investors, a Viennese tenement house is therefore a solid investment, which also drives the market.
Common reasons to sell a tenement house
The decision to sell a tenement house can have many triggers. Personal life circumstances or financial considerations often play the main role. Here are the most common sales reasons for tenement houses in Vienna:
- Inheritance and division of inheritance:It is not uncommon for a tenement house to be inherited within the family. The heirs are then faced with the question of whether they should continue to own the property together or sell it. Particularly when several heirs are involved, dividing the assets through a sale is often the simplest solution to avoid disputes and pay out their share to all heirs.
- Distribution among co-owners:Even outside of inheritance cases, there can be multiple owners (e.g. siblings, business partners or divorced spouses). Different goals or liquidity needs of those involved often lead to the decision to sell the tenement house in order to divide the tied up capital.
- Liquidity needs or strategic asset reallocation:A tenement house ties up a lot of capital. Owners who are planning larger investments or need financial flexibility (e.g. to purchase another property, share in a company or to finance their retirement) sometimes decide to sell in order to create liquidity. A tenement house sale can bring in millions of dollars in proceeds that can be used elsewhere.
- Steuerliche Optimierung:Sometimes the tax situation also plays a role. Although fundamentally real estate income tax is due on a sale (see Section 7), there may be cases in which a sale at a certain point in time is tax-advantageous. For example, increases in the value of real estate that were held for a very long time were tax-free until 2012 - owners of such properties only pay a flat rate of tax when selling (4.2% of the sales proceeds).
- Hoher renovationsbedarf:A very practical reason is the condition of the house. Many tenement houses are getting old and require expensive repairs (roof, risers, facade, etc.). Due to the tenancy laws, owners are often unable to pass these costs on in full to the rent, meaning that large renovations are not worthwhile from the current income. If a house requires significant investments that the owner is afraid of or cannot afford financially, it is better to sell.
- Emotional reasons and life planning:Finally, age and personal plans sometimes also play a role. Some owners no longer want to be responsible for a large rental house as they get older or have no successors who could take care of it.
Sales options: Investors vs. owner-occupiers as buyers
Once you have decided to sell, the question arises: to whom should the tenement house be sold? Basically, two buyer types come into consideration:
(a) sale to investors (private or institutional):The majority of tenement houses are sold to investors. This includes wealthy private individuals who may already own a portfolio of rental properties, as well as professional companies or real estate funds. Such buyers are profit-oriented - they pay particular attention to the numbers (rental income, running costs, development potential).(b) sale an Eigennutzer:Owner-occupiers buy the tenement house for their own purposes, not primarily as an income property. In practice, this mainly occurs with smaller tenement houses or special constellations - for example when an entrepreneur buys an entire house in order to use it partly as a company headquarters or for employee apartments.tenement house evaluate: What factors determine the value?
Die tenement housebewertungis a central topic in the sales process. Here are the most important value factors:
- location of the tenement house:As always in the real estate industry, the address is a main criterion. In Vienna the following applies: district location, micro-location (e.g. proximity to the subway, universities, city center) and the surrounding area determine how attractive the house is for tenants and therefore for buyers.
- Size and type of building:The number of apartments, total usable space and the type of use also play a role. A purely residential apartment building is to be evaluated differently than a mixed-use house (e.g. with offices or business premises).
- rental income and rental contracts:For investors, the current actual yield is one of the first clues. The amount of annual net rental income is important, as is the question of whether there are vacancies.
- Condition and substance of the building:The structural condition also has a significant influence on the value. A tenement house in poor condition (renovation backlog, outdated risers, pollution, etc.) will be less attractive for buyers.
- Yield per square meter of usable space:A frequently mentioned parameter is the price or yield per m². This is how you compare tenement houses with each other.
- Mieterstruktur:Soft factors such as tenant structure can also play a role. If the tenants are very elderly, there is an opportunity to re-let at higher rents in the medium term.
- operating costs and administration:Tenement houses have ongoing operating costs (insurance, house care, garbage, cleaning, etc.), some of which can be passed on to tenants.
- Entwicklungspotenzial:An often underestimated value factor is the future potential of a tenement house. Are there options for expansion (e.g. unfinished attic that can be converted into new apartments)?
The sales process at a glance
The actual sales process for a tenement house is more complex than for a single apartment. Below is an overview of the typical phases – from preparation to completion:
- Schritt 1: Vorbereitungand document collection.
- Schritt 2:sales strategy and pricing.
- Schritt 3:marketing and buyer search.
- Schritt 4:Examination, negotiation and commitment.
- Schritt 5:purchase agreement and conclusion.
Steuerliche Aspekte beim tenement house-sale
When selling a tenement house in Austria, there are specific taxes that you should keep in mind right from the start, as they have a significant impact on the net sales proceeds. Here are the key tax points:
- real estateertragsteuer (ImmoESt):Profits from private real estate sales have been subject to real estate income tax in Austria since 2012. The tax rate is a flat rate of 30% on the profit achieved (selling price minus acquisition costs and any investment expenses). However, there are different regulations depending on when you bought the tenement house.
- However, if you have owned the tenement house for a very long time (purchased before April 1st, 2002), you can use a special regulation. In such cases, the acquisition costs can be set at a flat rate of 86% of the selling price, which means that only 14% of the selling price is taxed as profit. This leads to a tax burden of around 4.2% of the selling price (14% profit share × 30% tax rate).
- Hauptwohnsitzbefreiung:If you used an apartment within the tenement house for your main residence, part of the sale could be tax-free. The main residence exemption applies if you have used the property as your main residence for at least two years continuously or for five years within the last ten years. This usually applies to single-family homes or condominiums, but could also apply to the portion of the tenement house that you live in yourself.
- Real estate transfer tax and fees:The property transfer tax of 3.5% of the purchase price is charged in Austria when purchasing a property and is normally borne by the buyer. The registration fee in the land register (1.1%) must also be paid by the buyer. However, this indirectly reduces the buyer's willingness to pay a higher price.
- Umsatzsteuer:Sales of tenement houses are generally VAT-free as they are used real estate. However, if you are an entrepreneur and have collected sales tax on rents, the sales case could check whether sales tax is due on the sale.
Rechtliche Besonderheiten beim tenement house-sale
The sale of a tenement house touches on a number of legal issues - in particular from tenancy law. As a seller, you “only” have to transfer the property, but the buyer will pay particular attention to the legal framework of the rental agreement. Here are the most important legal aspects:
- “Purchase doesn’t break rent”:This principle states that existing rental agreements must be taken over by a new owner. The new owner legally assumes your role as landlord. This means that the buyer also assumes any obligations from the past (such as repairs not carried out or pending legal proceedings), at least in fact.
- tenancy lawliche Besonderheiten (MRG):A large part of the Viennese tenement houses are subject to the strict tenancy laws. Old buildings with permanent contracts are particularly affected. This brings with it rent restrictions and protection against termination. For the buyer this means: Existing tenancies are difficult to terminate and rent increases are often only possible under certain conditions.
- Rent restrictions:In Vienna, old building rents are regulated. This means that the rent cannot be agreed completely freely and is often tied to the so-called guideline rent. For a buyer, this means that future income potential could be limited if many apartments are still rented at low rents.
- Vorkaufsrechte:Unlike in some countries, tenants in Austria do not have a legal right of first refusal when an entire apartment building is sold. So you don't have to offer the property to tenants first. However, there are special regulations if the tenement house is converted into residential property, as the tenants may then have a right of acquisition.
- heritage protection and building regulations:Some Viennese tenement houses are under heritage protection or are located in protected zones. Strict requirements apply to structural changes. Make sure to provide the buyer with all relevant information about heritage protection or existing official requirements.
What documents are needed for the sale? (checklist)
The flow of documents and information is crucial in tenement house sales. Here is a checklist of the most important documents you should have ready:
- land register excerpt:A current extract from the land register that proves your ownership and shows all important entries such as encumbrances, liens or easements.
- Katastralmappe:An official plan approval of the property on which the tenement house stands, including property numbers and boundaries.
- Construction plans and floor plans:Complete construction plans of the building, ideally the building authority submission plans and current floor plans for each floor.
- Interest rate list and rental agreements:An overview of all rental units (apartments, bars, garages, etc.), information on the rent, rental start and end as well as copies of all rental agreements in full text.
- operating costsaufstellung:The last annual statement of operating costs, which includes garbage, water, sewer, house care, insurance costs, etc.
- Maintenance contracts and service providers:Contracts with external service providers such as property management, elevator maintenance, chimney sweeps, house cleaning, etc.
- Versicherungsnachweise:Building insurance policies, liability insurance for house and property as well as evidence of damage or repairs.
- Documentation of building technology:Maintenance records for the heating system, electrical findings, chimney sweep certificates and test reports for the elevator.
- Renovation and renovation documentation:Evidence of modernizations carried out (e.g. roof renovations, facade insulation, window replacement) and repairs.
- energy certificate:A valid energy certificate that is not older than 10 years and shows the heating requirements and the overall energy efficiency factor of the house.
- Parifizierungsgutachten (Nutzwertgutachten):If the tenement house has already been divided into residential property or this has been prepared.
- Official notices and permits:All relevant permits and notices, such as: B. for expanding the attic or for a planned renovation.
- Fotodokumentation:Current photos of the building, the facade, the staircase and relevant living spaces.
- Exposé / Objektbeschreibung:A detailed description of the tenement house, which includes the most important facts such as location, building condition, rental overview and special features.
Role of brokers: Why professional support is important
Given the complexity associated with selling a tenement house, it is advisable to consult an experienced real estate agent. A broker can help you get the best price and handle the sales process efficiently and safely.
advantages eines brokers:- Market knowledge and realisticvaluation:A broker knows the current market prices and the wealthy buyer groups. In this way, the asking price is set realistically and in line with the market.
- Targeted marketing and buyer approach:Thanks to a well-established network, the broker already has access to potential buyers and can offer the tenement house in a targeted manner.
- Processing and negotiations:The broker takes care of the entire process, from obtaining documents to negotiating with buyers and concluding the contract.
advantages von VIRES im salesprozess
Selling a tenement house is not an everyday business. Vires Real Solutions is an experienced real estate company that will assist you with this complex process. With a comprehensive network of pre-booked buyers and expertise in the Viennese market, we can help you achieve the best price and handle the sales process smoothly.
FAQ – Frequently asked questions about the tenement house sale in Vienna
1\. What passiert mit den Mietern, wenn ich mein tenement house verkaufe?Für die Mieter ändert sich durch den sale fundamentally nichts. Der neue owner übernimmt alle bestehenden Mietverhältnisse mit den gleichen Bedingungen. Mieter können nicht gekündigt werden, es sei denn, es gibt besondere Gründe.
2\. Welche Steuern muss ich beim sale meines tenement housees bezahlen?Beim sale fällt die real estateertragsteuer (ImmoESt) an, die 30 % des Gewinns beträgt. Bei sehr langfristig gehaltenen Objekten gibt es eine Pauschalregelung mit einer Steuer von nur 4,2 % des selling pricees. Weitere Steuern wie die Grunderwerbsteuer trägt in der Regel der buyer.
3\. How wird der Wert meines tenement housees ermittelt?Der Wert eines tenement housees wird vor allem durch die Erträge aus den rental income bestimmt. Zusätzlich spielen location, Zustand und mögliche Entwicklungspotenziale wie der Ausbau des Dachbodens oder die Umwandlung in Eigentumswohnungen eine Rolle.
4\. How lange dauert der salesprozess?Der sale kann je nach Marktbedingungen und der Komplexität des Objekts mehrere Monate bis über ein Jahr in Anspruch nehmen. Rechne mit 6–12 Monaten vom salesstart bis zum Abschluss.
5\. Sollte ich mein tenement house parifizieren, bevor ich es verkaufe?Das Parifizieren (Aufteilen in Eigentumswohnungen) kann den Wert steigern, ist aber zeitaufwändig und kostspielig. Es lohnt sich vor allem, wenn viele Einheiten frei sind. In den meisten Fällen ist der sale des gesamten tenement housees an einen Investor der pragmatischere Weg.
6\. Kann ich mein tenement house auch ohne broker sell?Ja, das ist fundamentally möglich. Allerdings bietet ein broker viel Expertise, in particular in rechtlichen und steuerlichen Fragen, und kann den sale effizienter und oft zu einem besseren Preis abwickeln.
7\. Welche Unterlagen benötige ich für den sale?Du benötigst unter anderem den land register excerpt, Mietverträge, eine aktuelle operating costsabrechnung, Baupläne, einen energy certificate und eine vollständige Dokumentation von Reparaturen oder Renovierungen. Eine gut organisierte Dokumentation beschleunigt den salesprozess.
8\. What passiert, wenn mein tenement house unter heritage protection steht?Ein denkmalgeschütztes tenement house hat spezielle Anforderungen an Renovierungen und Veränderungen. Das kann den salesprozess beeinflussen, ist aber auch ein advantage für buyer, die den Charme historischer Gebäude schätzen. Stelle sicher, dass der buyer über alle heritage protectionauflagen informiert ist.
9\. Kann ich meinen Mietern kündigen, um das tenement house zu sell?Die Kündigung von Mietern ist nur unter bestimmten Voraussetzungen möglich, z. B. bei Eigenbedarf oder schwerwiegendem Vertragsverstoß. In der Regel bleiben Mieter jedoch geschützt und können nicht ohne Weiteres gekündigt werden.
10\. How finde ich den richtigen buyer für mein tenement house?Der richtige buyer ist oft ein Investor, der an den Erträgen aus den rental income interessiert ist. Ein broker mit experience im tenement houseverkauf kann dir helfen, den passenden buyer zu finden und den besten Preis zu erzielen.
* Sources: Further reading: Planen Sie den sale Ihres tenement housees in Vienna? → property sell in Vienna