Excerpted from the Austria Career Guide
Cost of Living
The good news: consumer prices in Austria are holding steady with the inflation rate at 2.5 percent, compared to 3.3 percent a year ago. However, the key drivers of higher prices remain housing, food and energy costs.
Even better news: Austria’s rising wages are topping inflation, giving consumers a slight purchasing power increase. Median wages in Austria are forecast to increase by around 3.0 percent this year.
Not-so-good news: Unfortunately, Austria’s economic health is tied to the economic weakness of the European countries struggling with an escalating debt crisis. As a leading member of the Eurozone (those countries participating in the euro currency), Austria’s relatively robust economy is threatened by much less financially stable partner countries, such as Greece, Spain and Portugal. Expats in Austria should pay attention to current economic news, particularly rising costs of food and fuel.
According to the US embassy in Austria, the purchasing of real estate in Austria by foreigners has become more restricted in recent years. Jurisdiction in matters of real estate transactions remains with the provincial governments. In most provinces, real estate purchases by foreigners are either prohibited or have to be approved by a governmental commission. In general, buyers can expect to pay 10 percent in fees on top of the purchase price. Costs include a combined 4.5 percent property tax and land registration fee, as well as a 3.6 percent agent’s fee and 1.5 to 2 percent in legal fees. Mortgage financing is available, though buyers may be expected to put as much as 40 percent down on the purchase price.
Medical Care and Health Insurance
The most recent Euro Health Consumer Index, which ranks 34 national European health care systems, places Austria at number 11 (down from fourth place in the previous report). Health insurance in Austria is compulsory, and the majority of the population is covered by statutory health insurance.
Currently, medical costs, including fees for doctors, hospitals and medicines, are paid for by state health insurance firms, the Krankenkassen, which provide health insurance coverage for their members. All insured persons and family members are issued e-cards to verify coverage.
Foreign employees in Austria are required to pay income tax only on income earned in Austria. The country has entered into a number of bilateral tax treaties to prevent double taxation of residents. There are four graduated tax bands for individuals ranging from 0 to 50 percent, the highest rate applied on earnings more than 60,000 EUR.
This is just a short sample of what you’ll find in over 100 pages of information in the Austria Guide.