Some Slovak buyers are surprised to find that the final purchase price of real estate in Austria may be up to 10% higher than the list price, as it includes the real estate agent’s fee, a 3.5% real estate tax, a 1% fee for recording the sale in the land register, and 2% for the public notary’s fee. Real estate agents commonly inform buyers of all the supplementary fees before a binding offer is submitted, however.
Those that engage an Austrian firm to build a new house on a building lot they have acquired also complain that the rates of the local builders are almost double what a similar firm in Slovakia would charge. However, due to an exemption that Slovakia won to Austria’s decision to keep its labor market closed until 2011, self-employed builders with Slovak licenses as well as Slovak contractors are allowed to work in Austria as long as they register with the labor authorities (Ministry of Economy and Labor, Abteilung I/9, Vienna, Tel: +431 711 005 826, email@example.com).
Slovak banks are by law forbidden to offer mortgages to finance purchases of real estate abroad; nor can foreign real estate be used to secure a Slovak loan. However, Austrian banks are more than willing to lend money to buyers from Slovakia. The main bank in Hainburg has given mortgages to more than 1,000 Slovak applicants in the past 18 months. The typical loan has a maturity of 25 years, requires a 20% down-payment, and carries a 5.5% interest rate.
18. Mar 2008 at 0:00 | Tom Nicholson