A full explanation of the rules which apply equally to residents and non residents wishing to buy properties in Austria.
Freudenau hydro-electric dam
First. Some background . . . .
Austria is a very beautiful country renowned for its mountains, lakes and green countryside. The Austrian Government together with the Austrian people are proud of their country and take active steps to preserve its natural beauty. Tourism is an integral and vital part of the national economy and the rules which apply to property purchase are designed to ensure that the stunning countryside remains unspoiled.
Pollution is simply not allowed and lakes, rivers and streams are all maintained at "drinking water quality". The whole thinking of the country is Eco-friendly and everything is planned to be environmentally sustainable. There is no nuclear energy and all the electricity is generated by Hydro-Electric power schemes in the mountains and rivers. Waste recycling is treated very seriously and waste of every kind is assembled at local collection points in every town and village. The country is also determined to reduce its dependency on oil. Therefore, in every town and village local central heating plants are being built which are fired on waste wood from the extensive forests resulting in carbon neutral heating for many Austrian families. Hot water is pumped around the village in underground pipes and hot water and central heating may be enjoyed at 60% of the price of oil.
Kaprun hydroelectric power plant
There is no litter, no graffiti and hardly any crime. It is a very safe country in which to live. There are very few burglar alarms as no-one sees the point in installing one ! They are just unnecessary.
So, in order to preserve their lovely towns and villages the following rules apply. Please note that they apply equally to Austrians and to other inhabitants of EU countries.
In order to prevent prime properties in pretty towns and villages being bought up by non residents of that village the rule is, that you can buy a property there but only if you are going to become perma nently resident in that property and be listed as tax resident there with the liability to pay taxes to the Austrian Government on your world wide assets.
They will not allow properties to be bought up and be unoccupied with the shutters closed and weeds in the garden. This looks bad and ruins their tourism. Such is the reasoning. Equally, this causes upward pressure on house prices so that eventually with so much competition from outsiders local villagers can no longer afford to live there.
Properties with the residential restriction are called "Hauptwohnsitz" properties which translates as "Place of main residence". Properties which may be bought and used as holiday properties without the requirement for permanent residence are called "Zweitwohnsitz" - or place of secondary residence.
Inhabitants of the EU including Austrian residents.
The same rules apply to Austrians as apply to persons resident in other countries of the European Union. They can buy any property that they wish provided that they become tax resident. They may only buy a holiday home if it is classed as "Holiday use" i.e. Zweitwohnsitz.
Residents of non-EU countries.
They may buy Zweitwohnsitz "Holiday properties" but the only difference is, that permission has to be obtained from the local Austrian authorities for the purchase. Essentially, it is not possible to obtain a general permission but rather a potential buyer should first visit Austria and find a property which is suitable and make a specific written offer to buy it. The selling agent will then ask the local Land Use Committee" (Grundverkehrsbehörde) for permission to buy. This is normally granted and lots of citizens of countries from outside the European Union enjoy having the use of a holiday property here.
All European Citizens have the right to take up full time residency in Austria provided that they hold a passport issued by an EU member state. Even so, the Austrian Government does not welcome 'free-riders' and so it is necessary to show that you have adequate income to live from and that you have adequate medical insurance. Without these two things even EU citizens from other countries may not stay.
Buying a holiday property in Austria does not confer the right of permanent residence.
The Austrian Government welcomes inward capital investment into the country and has a special department tasked with attracting inward investment. We work very closely with them and can arrange an introduction as required.
Where fairly substantial capital sums are to be invested and if sufficient jobs are created the Austrian Government may look favourably on an application for permanent residence. This depends on circumstances. The purchase of large hotels etc might possibly qualify but it is for the authorities to decide.
Bed & Breakfast business in Austria
However, there is some hope on the horizon for individuals with less to invest. The situation is, that there was a boom in tourism in the 1970's and during that period a great many family Guesthouses and small hotels were constructed. Forty years later it has been recognised by the Austrian authorities that the third generation are less keen than their parents and grandparents were to work the long hours that a family hotel demands. The Government are quite concerned that many family hotels may simply close down and will be an eyesore in the village centre. It may be, that rather than see a local business close for ever that the local land use commission "Grundverkehrsbehörde" might support a residency application. It would be entirely for them to decide but considering that a closed down business contributes nothing to the economy they may adopt a different view.