Right of first refusal for real estate in Austria

A right of first refusal (Vorkaufsrecht) for real estate in Austria is a legal mechanism that allows a specific individual or organization to purchase a property under the same terms as a third-party buyer. This right does not arise automatically, but must be stipulated in a contract and, to protect the interests of the beneficiary, registered in the land registry.

This preemptive right is used for both residential apartments and commercial properties. It protects the interests of tenants, investors, and neighbors, helps prevent unwanted ownership changes, and provides the opportunity to "put yourself in the shoes" of a potential buyer while maintaining control over the transaction.

The Austrian right of first refusal law establishes the rights and obligations of the parties. The principles are defined by the Austrian Civil Code (ABGB, §§1072–1079), and the right may be established by contract, gift, exchange, or lease with subsequent purchase.

There are three main forms of law:

A contractual (schuldrechtlich) agreement is valid only between the parties involved. It does not protect the beneficiary from third parties and is suitable for cases where both parties trust each other and do not plan to transfer the property. For example, a tenant may enter into an agreement with the owner for the right to purchase the apartment upon termination of the lease.

A deed registered in the land registry (dinglich) provides much greater protection. It is valid against all future buyers and is recorded in the C-Blatt Grundbuch, making the title public and binding on anyone who subsequently acquires the property. In practice, this form is most often used by investors and legal entities to guarantee purchase priority in resales or complex real estate transactions.

The legal right is applied in special cases, such as housing cooperatives, social programs, or certain municipal initiatives. It protects the interests of tenants and local communities, giving them the opportunity to purchase their homes on preferential terms.

The lease-purchase relationship in Austria deserves special attention . In some cases, long-term tenants may have a preemptive right to purchase an apartment or house if the property is put up for sale. This is an important tenant protection tool and, at the same time, a factor influencing investors' decisions when purchasing income-generating properties.

In Austria, municipalities and public authorities often have a special right of first refusal on real estate within the framework of urban development, social, or strategic programs. This right is enshrined in local regulations and is part of the Austrian Right of First Refusal Act.

The purpose of this right is to preserve social infrastructure, ensure affordable housing, monitor urban development projects, and prevent speculative price increases on key sites or buildings. When selling real estate, the owner is required to notify the municipality in writing of the transaction, specifying the terms of the purchase. The municipality is given a standard period to make a decision—usually 30 days for real estate. If the municipality agrees, it enters into the transaction under the same terms as a third party.

In practice, this right is actively applied in older residential areas of Vienna, where the municipality can purchase apartments for conversion to social housing, as well as when selling land for the construction of municipal infrastructure, which is consistent with the pre-emptive right of purchase in Austria. Investors should consider possible municipal intervention when planning residential and commercial real estate transactions. Failure to comply with the notification procedure can lead to litigation and the invalidation of the transaction.

In real-life practice, I see that knowledge and proper preparation of documents allows you to avoid conflicts and anticipate potential restrictions when purchasing housing or land.

You can check for a Vorkaufsrecht (pre-emptive title) for an apartment or plot of land in Austria through the C-Blatt Grundbuch (pre-emptive title) – a section of the land registry that records all pre-emptive rights and other encumbrances on real estate.

• Parties to the transaction: sellers, buyers, tenants, beneficiaries of the right.
• Legal representatives and notaries acting under the power of attorney of the parties.
• State authorities, if officially required (e.g. municipalities monitoring compliance with the pre-emptive right to purchase housing in Austria).

• The request requires confirmation of legitimate interest.
• The right data includes the conditions of implementation, the term of validity and exceptions (e.g. family transfers, gifts).
• Verification is particularly important in transactions involving adjacent plots (right of first refusal on a plot in Austria) or land objects (pre-emptive right to purchase land in Austria) to avoid legal disputes.
• The register shows not only the existence of the right, but also the conditions for its implementation: the term of validity, the circle of beneficiaries, and exceptions (for example, family transfers or gifts).

Due diligence at this stage helps plan transactions in advance, minimize risks, and ensure compliance with all legal formalities, especially when investing in resale or commercial real estate.

To understand how the right to buy property works in Austria, it is important to consider the entire process from the moment a third party makes an offer to the closing of the transaction.

1. The process begins with the owner receiving a real offer from a third-party buyer. Until this point, the beneficial owner's right of repurchase is not activated, and the owner remains free to dispose of the property. For example, if an apartment in Vienna is put up for sale and a specific offer is received from an investor, it is at this point that the tenant or registered beneficiary has the opportunity to exercise the right of repurchase.
2. The next step is notifying the beneficiary . The seller is required to notify the titleholder in writing of their intention to sell the property, detailing the price, payment terms, and deadlines for making a decision. In practice, errors in the notice, such as an incorrect price or deadline, can block the response period from starting. I have encountered situations where an incorrect notice delayed transactions by several weeks and required correction through a notary.
3. By law, the beneficiary has 30 days to make a decision regarding real estate . However, the contract may provide for an extension, especially in investment transactions involving commercial properties or multiple parties. For example, when selling an office building to an investor, the decision-making period is often extended to 60 days to allow for verification of the financial terms and credit obligations.
4. The form for exercising this right is simple : the beneficiary only needs to submit a unilateral written statement of intent to purchase the property. If agreed upon in the contract, electronic notification is also permitted, which speeds up the process and minimizes bureaucracy.
5. In transactions involving large properties , escrow and notary support . In such cases, the period for exercising the right begins only after the deposit is confirmed or a trusted notary is appointed. For example, when purchasing a residential complex in a suburb of Vienna, the beneficiary must first transfer funds to an escrow account, after which the 30-day period begins.

According to Austrian lawyers and notary chambers, pre-emptive rights are relatively rare—appearing in approximately 10–15% of residential real estate transactions and more often in corporate or investment projects. In the rent-to-own segment, such agreements are becoming increasingly popular, particularly in Vienna and the larger federal states, where rental housing is gradually being transformed into owner-occupied properties.

Registering a property right in the land registry costs approximately 500 euros, including notary fees and data entry fees. The cost may vary depending on the complexity of the transaction. Typically, the costs are borne by the property right holder, as they are the beneficiary, but other arrangements can be negotiated.

Despite the additional costs, Vorkaufsrecht remains a beneficial instrument for protecting interests, especially for investors and tenants.

The right of first refusal (Vorkaufsrecht) is a powerful tool for protecting interests, but it does not last forever. There are situations in which this right ceases to apply.

• Waiver of the right holder: freedom of choice. The beneficiary may voluntarily waive the right by executing a written declaration. In this case, the property owner is no longer obligated to offer the property for purchase. This waiver is often used by investors who decide not to participate in a transaction if the terms are not favorable.
• Expiration of the term: if you don't make it, you lose it . By law, the holder is given 30 days to exercise the right to real estate. If this period passes without action, the right automatically expires. In practice, this period may be extended in contracts, especially for large transactions involving investment properties.
• Death of the beneficiary: the right is not inheritable. A Vorkaufsrecht is a personal right, so it is not passed on to heirs unless otherwise specified in the contract. This means that upon the death of the holder, the right ceases, and the owner is free to sell the property.
• Compensation: an agreement in lieu of a right. Sometimes a right can be "purchased"—the holder agrees to compensation instead of exercising the right. This is convenient in situations where both parties want to close the deal quickly.
• Attempts to circumvent the law. Sellers sometimes attempt to circumvent Vorkaufsrecht in Austria through fictitious transactions, transferring the property to a company, a relative, or creating exchange agreements. Case law shows that such actions may be declared invalid, and the beneficiary has the right to demand a refund or compensation.

Tenants with Privileges. In Austria, there is no general right for all tenants, but subsidized apartments or rent-to-own schemes may offer a first-choice option. This mechanism gives long-term tenants a real chance to become owners on favorable terms.

Inheritance and transfer of rights . If the property is inherited, the right of first refusal may continue to apply to the heirs if so stipulated in the contract.

The pre-emptive right to purchase housing in Austria provides the beneficiary with a number of advantages, but at the same time carries certain risks.

• Protection from competitors: the right holder has the opportunity to purchase the property before a third-party buyer does. This is especially important given the high demand for real estate in Vienna and other major cities.
• Predictability of price and terms: the beneficiary purchases the property under the same terms as a third party, which avoids speculative price increases.
• Investment planning: The law allows you to plan financial and investment strategies in advance, including purchasing apartments, houses, or land.
• Rental Application: Long-term tenants can take advantage of the lease-to-own option for resale properties in Austria, giving them an advantage over third-party buyers.

• Reduced liquidity of the property: real estate with a registered right of first refusal may be less attractive to other investors.
• Legal and notary fees: Registration of title requires costs, especially when it comes to resale properties or land plots.
• Limitation of the seller's freedom: the owner of the property cannot freely dispose of it, which can create delays in the transaction.
• It is important to strictly adhere to deadlines and procedures: failure to comply with the 30-day period or errors in notification may result in loss of rights.

In practice, I see that RoFR in Austria is often underestimated, especially by tenants and small investors. Many believe the law automatically protects their interests, but reality shows that without proper notification, registration, and compliance with deadlines, this advantage can be lost. Therefore, an experienced approach to verifying and implementing the law is key to a successful transaction.

The Vorkaufsrecht right in Austria is not only a classic right of pre-emption, but also an instrument that evolves with the market and adapts to new conditions:

Limiting "perpetual" rights and protecting tenants . In cities like Vienna, legislation is gradually limiting long-term or "perpetual" rights of first refusal to protect tenants and prevent market monopolization. However, long-term tenants can still use leasehold and right-of-purchase rights in Austria, allowing them to purchase apartments on favorable terms.

Use in forced auction procedures (Zwangsversteigerung). In cases of auction sales, the beneficiary can exercise the right of repurchase when selling a house in Austria after the auction. This is an unusual but effective strategy that allows the buyer to purchase the property at the price offered by a third party, even if they have already participated in the auction.

Corporate and investment cases. Preemptive rights to purchase land in Austria  are actively used in corporate restructurings, exchanges, and land transactions. Companies use preemptive rights to gain early control of assets and limit competition.

Right of first refusal on neighboring land in Austria. In some cases, landowners are given the right of first refusal on neighboring land, which is especially important for investors planning to merge or expand their properties.

Partial Sale and Right of Purchase. Some owners sell a portion of their property, retaining the right to purchase the sold shares. This allows them to free up capital while still retaining the option to return the property. For example, if 10%, 25%, or 50% of the property is sold, the owner can repurchase these shares at the current market price.

The right of first refusal for real estate in Austria is an effective tool that protects the interests of the beneficiary while simultaneously imposing certain restrictions on the owner. It applies to apartments, houses, and land plots alike, and requires careful adherence to formalities, registration in the land registry, and prompt notification of all parties.

The right of first refusal helps make the real estate market more transparent and predictable, protecting the interests of long-term tenants and investors. In practice, the effectiveness of this right directly depends on strict adherence to deadlines, proper execution of contracts, and preliminary verification of registers. It is important for investors, realtors, and tenants to take advantage of this right without the risk of conflict.