DI Martina HoffmannFHWien University of Applied Sciences of WKWInstitute for Real Estate Management

REDESIGN OF THE REAL ESTATEMARKET BY LEGAL REGULATION:Impacts on the condominiummarket by EAVG and EAVG 2012

Research associate of the Institute for Real Estate Management

► REDESIGN OF THE REAL ESTATE MARKET BY LEGAL REGULATION:

Is it really possible to make the real estate market energy driven by legal regulation?

What kind of results can be observed (focused on the Viennese condominium market)?

Started in October 2012 Still running

Energy Performance Certificate Template-law – EAVGedited in August 3rd 2006 according to Directive 2002/91/EG

Idea: if the energy demand of buildings is transparent, the demand for objects with good energy performance will increase

For buildings with an issued building permit after December 31th,2005, the deadline was January 1st, 2008.

For buildings with an issued building permit before January, 1st, 2006, the deadline was January 1st, 2009.

Consequences were weak: if no energy certificate was submitted

until the buyer or tenant has given a contractual notice, appropriate energy performance was agreed

As a result very few EC were available on the market and the original idea “that buildings with good energy performance will have a better marketing position” failed.

F H W I E N U N I V E R S I T Y O F A P P L I E D S C I E N C E S O F W KW4

Legal Situation in Austria according to Directive 2010/31/EU edited May19th , 2010 on the energy performance of buildings

The new Directive 2010/31/EU brought up the Energy Certificate law 2012 (edited on April, 20th 2012 and valid since December 1st , 2012)

in printed and electronic media► the demand of heating [HWB] ► the total energy performance factor

penal provisions up to 1,450 EUR

obligation to submit and delivery the Energy Certificate right of compensation of the costs for the creation of an EC legal consequences of the submission: EC creator is liable for the

agreed correctness short list of exemptions

F H W I E N U N I V E R S I T Y O F A P P L I E D S C I E N C E S O F W KW5

PRIVATE VIENNESE CONDOMINIUM MARKET

Situation in Vienna According to the housing census 2001 there are

168,167 buildings

910,475 apartments and

475,423 apartments are private owned (Statistik Austria, 2007)

F H W I E N U N I V E R S I T Y O F A P P L I E D S C I E N C E S O F W KW6

PRIVATE VIENNESE CONDOMINIUM MARKET

► Electronic media Advantage of electronic media is that a large amount of

advertisements is available (more than 6000 advertisements)

Disadvantage is the high work impact, as the websites are always changing

► Printed media Advantage : Fixed delivery dates and more solidity Disadvantage: less advertisements (about 300

advertisements) week) IMMO Kurier, which is a supplement of a well known

Austrian daily newspaper. It appears every Saturday.

F H W I E N U N I V E R S I T Y O F A P P L I E D S C I E N C E S O F W KW7

PRIVATE VIENNESE CONDOMINIUM MARKET

Before starting with the evaluation of advertisement:

What is a real estate advertisement in the context of the EAVG 2012?

Explanation in the pre- paper „Vorblatt“ EAVG 2012 (parlament.gv.at,13.04.2012)

“Addressed to concrete persons with contractual interests (e.g. prices)”

Own definition:

As soon as the advertisement shows one parameter, which is referring to a specific object, it was counted as a real estate advertisement

F H W I E N U N I V E R S I T Y O F A P P L I E D S C I E N C E S O F W KW8

PRIVATE VIENNESE CONDOMINIUM MARKET

F H W I E N U N I V E R S I T Y O F A P P L I E D S C I E N C E S O F W KW9

not counted

counted

Methodology

In order to identify the changes on the real estate market:

print media

focus on private condominium market in Vienna

definition of real estate advertisements

took three samples of the IMMO Kurier every sample covered a period of 6 weeks

5210 advertisements listed in the IMMO Kurier were evaluated

F H W I E N U N I V E R S I T Y O F A P P L I E D S C I E N C E S O F W KW1 0

RESULTS:PRIVATE VIENNESE CONDOMINIUM MARKET

1) November 17th,2012 to December 22nd ,2012

F H W I E N U N I V E R S I T Y O F A P P L I E D S C I E N C E S O F W KW1 1

RESULTS:PRIVATE VIENNESE CONDOMINIUM MARKET

2) February 16th ,2013 to March 23rd,2013

F H W I E N U N I V E R S I T Y O F A P P L I E D S C I E N C E S O F W KW1 2

RESULTS:PRIVATE VIENNESE CONDOMINIUM MARKET

3) May 18th,2013 to June 22nd ,2013

F H W I E N U N I V E R S I T Y O F A P P L I E D S C I E N C E S O F W KW1 3

RESULTS:PRIVATE VIENNESE CONDOMINIUM MARKET

1) There were hardly any advertisements available that included a positive energy marketing !!

2) From nearly zero to more than 75%

1) Market transparency is given to a certain extent2) There is a need for further explanation

3) The last 20% – 25% belong to the1) Definition of an advertisement2) Private advertisements3) Real estate agents and property developers, who just ignore the

new legal situation

F H W I E N U N I V E R S I T Y O F A P P L I E D S C I E N C E S O F W KW1 4

RESULTS:PRIVATE VIENNESE CONDOMINIUM MARKET

F H W I E N U N I V E R S I T Y O F A P P L I E D S C I E N C E S O F W KW1 5

1) Now it’s the turn of the customer to react:

1) Energy efficiency is seen as a social responsibility and customers

2) The energy parameters are taken as an indicator for the condition of the building stock.

3) Customers pay more attention to additional parameters

2) Further investigations have to be done

Institute for Real Estate ManagementWähringer Gürtel 97, 1180 ViennaTelephone +43 (1) 476 77-5825 Fax -5704martina.hoffmann@fh-wien.ac.at