Background information

In Austria, "guideline rents" (Richtwertmieten) are adjusted to inflation every two years on 1 April. In 2021, the government suspended the adjustment due to the economic hardships caused by the COVID-19 pandemic and postponed it to 2022, when an increase of 5.8% was implemented. Keeping the original bi-annual rhythm, the next increase was scheduled for 2023. On 1 April 2023 (for new contracts) and 1 May 2023 (for running contracts), an increase of 8.6% was implemented (determined by the Ministry of Justice based on inflation).

The rent increase concerns people renting an "old building" (Altbau), i.e. built before 1945 who signed a tenancy agreement after 1 March 1994 and a share of those living in social housing apartments in Vienna (80,000 of 220,000 - those with new rents since 2012). The guideline values vary depending on the federal state. In total, this concerns around 776,000 tenants in Austria with an average increase of €490 per year (for a 65 square metre apartment).

Content of measure

Upon the publication of the increase of rents of 8.6%, many civil society groups, opposition parties and organised labour groups have called to implement a moratorium and thus not increase the rent in 2023 amid high inflation and increased economic problems for many tenants. These groups and the Green Party called for a rent brake. Also, further alternatives were presented to the government over several weeks and months, including a proposition of the gradual implementation of the increase in several steps.

However, the conservative People's Party and senior partner in the coalition, rejected this and instead presented a compromise via the provision of an additional housing budget for the nine federal provinces of €225 million (due to the nature of the support, which lies within the competencies of the regions). The budget is to be divided among the individual federal provinces according to population size. Low-income households (including also those owning property and thus not connected to the guideline value increase) will receive around €225 each. It is estimated that about 1 million people are eligible to this support, according to the government. The allowance will be administered by the federal regions.

Use of measure

It is estimated that about 1 million households are eligible.

Target groups

Workers	Businesses	Citizens
Does not apply to workers	Does not apply to businesses	Applies to all citizens

Actors and funding

Actors	Funding
National government	National funds

Social partners

Social partners' role in designing the measure and form of involvement:

	Trade unions	Employers' organisations
Role	No involvement	No involvement
Form	Not applicable	Not applicable

Social partners' role in the implementation, monitoring and assessment phase:

• No involvement
• Main level of involvement: N/A

Involvement

The social partners were not involved in the design or implementation of the measure. The topic is not their core issue, but nonetheless, organised labour (the Austrian Trade Union Federation ÖGB and Chamber of Labour AK) are vocal about social issues and have demanded and advocated for a rental price brake for several months.

Views and reactions

Organised labour is against a one-time payment and would have preferred a sustainable measure, like a rental price brake.

No statement from organised business could be identified (it does not concern businesses, so it is not their domain).

Sources

• 23 March 2023: How do I get the housing allowance? (www.derstandard.at)
• 24 March 2023: Price shock for old building rents (www.arbeiterkammer.at)
• 28 March 2023: Housing subsidy: is this the right way? (www.derstandard.at)