Real Estate & Construction Law

For immovable property – in particular buildings – the warranty period is generally three years from handover (§ 933 ABGB). In addition, damages claims with their own limitation periods may exist. Because hidden defects, acknowledgements or contractual provisions (for example under ÖNORM B 2110) affect these periods, every construction defect should be documented and legally assessed as quickly as possible.

That depends on the chain of contracts and the cause of the defect: the contractor carrying out the work is liable for defects in execution, planners for planning and supervision errors, and the developer towards purchasers under the developer contract. Frequently several parties are potentially responsible – early preservation of evidence (for example through an expert) is then decisive.

Besides the purchase price and the handover date, the key points are the encumbrances shown in the land register (Grundbuch), warranty and liability provisions, escrow handling, and the ancillary costs – notably real estate transfer tax (usually 3.5 %) and the registration fee (1.1 %). The contract is drawn up by a lawyer or notary; handling it through an escrow account protects both sides.

The BTVG protects purchasers who make payments to a developer before completion. In particular, it requires those payments to be secured (for example under an instalment plan with a trustee) and prescribes mandatory contractual content. Deviations to the purchaser's detriment are invalid – reviewing the developer contract before signature is therefore particularly important.

The purchase agreement must be drawn up and certified by a lawyer or notary for entry in the land register. Legal representation also ensures that your interests – for example regarding warranty, financing clauses or escrow handling – are protected, particularly where the other side presents the contract.

Construction law is a matter for the provinces in Austria. Salzburg has no uniform building code; the rules are spread mainly across the Salzburg Building Police Act (BauPolG), the Development Principles Act (BGG) and the Building Technology Act 2015 (BauTG 2015). Anyone who has built in Vienna or Upper Austria cannot simply transfer those procedures – we assess your project under Salzburg law.

Neighbours have party status in the building permit procedure, but only to the extent of their subjective public rights – above all distances, height and protection against immissions. Purely aesthetic objections or a feared loss in value do not count. What matters is raising objections in time and with the correct content, at the latest at the oral hearing – whoever stays silent loses party status and with it any later right to appeal. We review the project documents and formulate the objections within the deadline.

The encumbrances sheet (C sheet) shows pledges, easements such as rights of way, utility rights or rights of residence, pre-emption and repurchase rights, and prohibitions on encumbrance and disposal; the property sheet (A sheet) shows the plots together with annotations. Just as important is what is not in the land register: the zoning under planning law, any water usage rights in the water register (Wasserbuch), and the building authority's consensus – in other words, whether what was built matches what was permitted. We check all four levels before you sign.

It solves the fundamental problem of a property purchase: the buyer should not pay before receiving unencumbered ownership, and the seller should not give up ownership before the money is secured. The trustee – a lawyer or notary – holds the purchase price in an escrow account and pays out only once registration is secured and pledges can be deleted; the process runs through the trust register of the Bar Association. For both sides this is the standard, and there is no good reason to depart from it.

Salzburg construction law distinguishes between projects requiring a permit, projects requiring only notification, and projects requiring neither; what matters is the type, size, location and use. New buildings, extensions and substantial changes to the external appearance or the use are generally subject to a permit requirement, while smaller structures often only require notification. Ahead of all these questions stands the zoning: whatever the zoning plan and the development plan do not cover will not be permitted even with complete documentation. Anyone who builds without a permit risks a removal order.

Under § 830 ABGB (Austrian Civil Code), every co-owner may demand that the co-ownership community be dissolved – regardless of the size of their share and without giving reasons. Anyone opposing this can only plead inopportune timing (Unzeit) or a disadvantage to the others, and that merely postpones the division rather than preventing it. If no agreement is reached, the court decides on a partition action. The law prefers physical division of the property (Realteilung); a judicial sale by auction comes into consideration under § 843 ABGB only where the property cannot be divided physically at all, or only with a considerable loss of value.

In a physical division, the property itself is divided: one plot becomes two, and each side receives one. In a judicial sale (Zivilteilung), the property is auctioned by the court and the proceeds are distributed according to the shares. Physical division is the statutory rule and almost always the better outcome economically. It frequently fails, however – for instance where a house stands on the plot and no second parcel of equal value can be created, or where one parcel would lack access and services. Whoever sues for a judicial sale must set out and prove that physical division is impracticable.

Yes, under certain conditions. The court can dissolve a co-ownership community by establishing condominium ownership of the property (§ 3 Abs. 1 Z 3 WEG 2002) – each co-owner then receives the exclusive right to a specific unit. The courts treat this as a special form of physical division: it takes precedence over a judicial sale and is possible even against the will of individual co-owners; conflict between those involved is no obstacle. What is required is that enough self-contained units of roughly equal quality exist or can be created without disproportionate effort. Whoever wants to force an auction must show why this route, too, is not available.

Gains from the sale of private property are subject to real estate income tax (Immobilienertragsteuer) at a special rate of 30 % (§§ 30, 30a EStG, Income Tax Act). The most important exemption is the main-residence exemption (§ 30 Abs. 2 EStG): it applies where the house or flat served as the seller's main residence either continuously for at least two years from acquisition, or for at least five years continuously within the last ten years, and the main residence is given up. For so-called old assets – property that was not subject to capital gains taxation on 31 March 2012 – the gain is determined on a flat-rate basis; at present this usually results in an effective charge of 4.2 % of the sale proceeds, or 18 % for rezoned building land. For sales after 31 December 2026 these rates rise to 6 % and 21 % respectively (§ 30 Abs. 4 iVm § 124b Z 498 EStG as amended by BGBl. I Nr. 62/2026) – what counts is the date of the sale. The calculation in the individual case belongs in the hands of your tax adviser; we draw up the contract and align handling and escrow with it.

A building permit lapses if execution of the project has not begun within three years of the decision becoming final (§ 9 Abs. 7 Z 1 Sbg. BauPolG, Salzburg Building Police Act). For large projects planned in stages, the authority may set longer periods of up to six years for individual construction phases; in addition, it may extend the period once by three years if the application is made before expiry and there are sound reasons for it. Once the permit has lapsed, the permit procedure starts again from the beginning – under the law then in force. Anyone shelving an approved plan should therefore keep this deadline in view.

On top of the purchase price, the standard items are real estate transfer tax of 3.5 % and the court registration fee of 1.1 %. Added to this are the costs of drawing up the contract and of the escrow handling, and, where the purchase is bank-financed, the registration of the mortgage in the land register. In municipalities with second-home restrictions, a procedure under the Salzburg Land Transfer Act 2023 (S.GVG 2023) may come on top. Our article Buying property in Salzburg: steps and costs explains the steps and costs in context.

Warranty also covers defects that nobody could see at handover: under settled case law it is sufficient that the defect was at least latently present at that time (RS0018498) – for instance a workmanship error that only leads to damp damage years later. Under § 933 Abs. 1 ABGB as currently in force, the transferor of immovable property warrants defects that come to light within three years of handover; the claims become time-barred three months after that period ends (§ 933 Abs. 3 ABGB). For contracts from before 2022 the earlier version may still govern, under which the period began to run on delivery; where a characteristic that cannot be verified immediately was warranted and guaranteed, the case law holds that the period only begins at the point at which the defect can be recognised with certainty (RS0018909). Separate damages claims with their own limitation periods may also exist. What matters in practice: document the defect immediately, notify the other party and have the deadlines reviewed by a lawyer – with hidden defects, much turns on preserving the evidence.