Three Trends Shaping the Real Estate Market in 2026 – and What Investors Should Do Now

By Igor Strehl, CEO Dunaj Family Office

2026 will be a year in which realism and opportunity are more closely intertwined than ever before. The major trends in the European real estate market are clearly visible – and their impact is particularly pronounced in Austria. Three trends stand out.

1. The Return of Price Increases Despite Interest Rate Caps

After two years of correction, the Austrian market is back on the rise. According to the Austrian National Bank (OeNB) and Raiffeisen Research, prices have already increased by 1.7% since the beginning of the year, and a further increase of around 2.5% is expected for 2026. The era of falling prices is over.

Why? Three forces are at work simultaneously:
  • Incomes are rising by more than 20% since 2022.
  • Completions are plummeting – half as many new apartments will come onto the market in 2026 as in 2022.
  • The population is growing, while new construction is stagnating.

Particularly interesting: Price growth is shifting. Existing apartments are once again becoming more expensive than new builds – a sign that affordability in existing properties has increased significantly. This opens up new opportunities for value-add and buy-to-let strategies.

2. New Asset Classes Are Moving Forward

The PwC/ULI study clearly shows where capital flows are moving: away from classic core segments and toward infrastructure-like assets. Data centers, energy infrastructure, student housing, and assisted living are leading the way.

These segments benefit from long-term structural drivers: demographics, digitalization, and decarbonization. For Austria, this means:
  • Energy infrastructure will grow massively due to the transformation of the electricity grid and increasing electricity consumption.
  • Student housing remains in demand, especially in Vienna, one of Europe's largest university cities.
  • Data centers are benefiting from the AI explosion – 75% of companies are already using AI, and this trend is increasing.

Those entering these sectors today are securing stable demand and structural growth.

3. ESG is changing the market, but in a more pragmatic way.

ESG remains important, but the focus is shifting: Only 21% of European experts now see ESG as the main driver of strategy (compared to 40% last year). Nevertheless, the pressure is increasing: Climate and energy efficiency are key factors in lending and valuation. 83% of investors consider physical climate risks crucial for financing and due diligence.

Austrian properties with good energy performance will benefit disproportionately, and they will also remain insurable—an often underestimated factor.

What does this mean for investors in 2026?

  1. Buy existing properties, don't wait.

    The market has bottomed out. In 2026, existing properties in good locations offer the most attractive combination of price level, rental potential, and value appreciation.

  2. Diversify into alternative asset classes.

    Energy, data, education, and housing are the four structural pillars of growth. These are the long-term drivers of returns.

  3. Use ESG as a value driver, not just a formality.

    Focus on energy efficiency, climate risk, and real-life impact. These factors determine financing costs and exit values.

2026 will not be an easy year, but an excellent one for strategic investors. Those who understand trends and act counter-cyclically will secure the best opportunities.

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