DI Martina Hoffmann FHWien University of Applied Sciences of WKW Institute for Real Estate Management

REDESIGN OF THE REAL ESTATE MARKET BY LEGAL REGULATION: Impacts on the condominium market 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 – EAVG edited in August 3 rd 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 31 th,2005, the deadline was January 1 st, For buildings with an issued building permit before January, 1 st, 2006, the deadline was January 1 st, 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. FHWIEN UNIVERSITY OF APPLIED SCIENCES OF WKW4

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 FHWIEN UNIVERSITY OF APPLIED SCIENCES OF WKW5

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) FHWIEN UNIVERSITY OF APPLIED SCIENCES OF WKW6

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. FHWIEN UNIVERSITY OF APPLIED SCIENCES OF WKW7

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, ) “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 FHWIEN UNIVERSITY OF APPLIED SCIENCES OF WKW8

PRIVATE VIENNESE CONDOMINIUM MARKET FHWIEN UNIVERSITY OF APPLIED SCIENCES OF WKW9 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 FHWIEN UNIVERSITY OF APPLIED SCIENCES OF WKW10

RESULTS: PRIVATE VIENNESE CONDOMINIUM MARKET 1) November 17 th,2012 to December 22 nd,2012 FHWIEN UNIVERSITY OF APPLIED SCIENCES OF WKW11

RESULTS: PRIVATE VIENNESE CONDOMINIUM MARKET 2) February 16 th,2013 to March 23 rd,2013 FHWIEN UNIVERSITY OF APPLIED SCIENCES OF WKW12

RESULTS: PRIVATE VIENNESE CONDOMINIUM MARKET 3) May 18 th,2013 to June 22 nd,2013 FHWIEN UNIVERSITY OF APPLIED SCIENCES OF WKW13

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 extent 2) There is a need for further explanation 3) The last 20% – 25% belong to the 1) Definition of an advertisement 2) Private advertisements 3) Real estate agents and property developers, who just ignore the new legal situation FHWIEN UNIVERSITY OF APPLIED SCIENCES OF WKW14

RESULTS: PRIVATE VIENNESE CONDOMINIUM MARKET FHWIEN UNIVERSITY OF APPLIED SCIENCES OF WKW15 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

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