(Bloomberg) — Austria plans to scrap a real estate transfer tax for people buying their first homes in a bid to make ownership more affordable.
(Bloomberg) — Austria plans to scrap a real estate transfer tax for people buying their first homes in a bid to make ownership more affordable.
Chancellor Karl Nehammer proposed scrapping the levy — 3.5% of the purchase price — in a speech in Vienna Friday. He also suggested expanding subsidized mortgages and rent-to-ownership programs.
Rising interest rates and years of price growth have made home ownership unaffordable for many in Europe. Stricter regulation on Austrian mortgages introduced last year has also contributed to a slump in new home purchases and lending.
The rules require borrowers to pay 10% of the cost of a home upfront, and cap monthly installments at 40% of household income in most cases. Expensive handling costs, including a regulated real estate agent commission of 3% of the purchase price, bank fees and property tax can inflate the cost of buying property by as much as 10%.
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