13 January 2020 – need2know
The programme of the turquoise-green government for the years 2020-2024 comprises a total of 328 pages. Only the pages 40-43 are covering the real estate industry. What can be expected in the new legislative period?
Climate Protection and Energy Efficiency
Not surprisingly, environmental issues play an important role. Re-consolidation and overbuilding should have priority over the sealing of green meadows. The federal states should implement climate-relevant measures in building regulations. Investment incentives for refurbishment and new construction (such as new depreciation possibilities) should be created, but with construction methods based on “highest ecological aspects”. Much depends on the new Fiscal Equalisation Act (FAG). With this, Austria is to become the leader in energy efficiency and the use of ecological building materials.
Also worth mentioning is the objective (occasionally described under “Housing Law”) to introduce a “right to plug”, i.e. a legal right to electricity charging stations for e-cars in housing estates, as well as the support of e-mobility through an obligation under the building code to install empty pipes.
At the same time, construction costs are to be reduced (e.g. by creating uniform nationwide regulations on technical regulations and speeding up construction processes) – admittedly an ambitious goal, given that the demand for greater energy efficiency will probably cause construction costs (which are already high) to rise further.
The housing subsidy contribution collected as a wage-related tax (a state tax since 2018 and no longer necessarily linked to housing construction purposes since 2008) is to be earmarked again within the framework of financial equalisation. In addition, renovation and re-densification are to be strengthened in the housing subsidy system and subsidies are to be granted only on condition that environmentally friendly construction takes place.
Condominium ownership is to be promoted (e.g. through tax relief for hire purchase). The Condominium Act (WEG) is to be amended and the enforceability of necessary maintenance measures increased. Decarbonisation measures will henceforth be regarded as maintenance measures. For the lawyer who is well versed in residential property law, however, some points in the government programme appear to require explanation: For example, the formation of maintenance reserves is already mandatory under current law and energy efficiency measures can already be adopted as improvement measures by a majority of residential property owners.
Under “Creating affordable housing“, there is a commitment to reforming housing law (also mentioning the Tenancy Act (MRG)). The amendment of the tenancy law should in particular take into account a “transparent, comprehensible tenancy law”, a “high level of legal security for tenants and owners” and “transparent pricing”, but also the “economic efficiency of investments such as new construction, re-densification, maintenance and refurbishment”.
Combating Vacancies and Underutilisation
Here, measures are to be examined to ensure that apartments are available to people living here for year-round rental – this would include short-term rentals for holiday purposes, as via Airbnb. Secondary residences are to be banned in municipal buildings and in subsidised leases.
The institute of (civil) building law (in which a building on third-party land is registered as a separate land register body), which has hitherto led a rather shadowy existence in practice, is to be made more attractive; in future the public sector is to assign its land holdings to third parties mainly by means of building rights.
Brokerage Commission According to the Ordering Principle (Bestellerprinzip)
Probably to the nuisance of many real estate agents, the ordering principle according to which the costs of an estate agent in the case of rental apartments are borne by the person who placed the order (which was much debated last year) is also reflected in the government programme.
All in all, the new government programme does not yet allow much concrete information to be leaked, and is currently limited to general slogans of the kind that one would find in any government programme – who would oppose affordable housing or advocate more difficult property formation? Only time will tell whether this government ultimately has the courage to make systemic changes, for example in the often confused and complex tenancy law. Similarly, a number of objectives (such as in building law or housing subsidies) will require the involvement of the federal provinces due to the distribution of competences under the Austrian constitution – (possibly tough) negotiations are still pending here.
If you have any questions, please contact us:
Real Estate and Lease Law
If you would like to receive future issues of need2know follow us on LinkedIn or please send an email to firstname.lastname@example.org.