Happy haus How Vienna became the world's most livable city

The Austrian capital's radical social housing tradition bucks the trend for soaring rents elsewhere. What is its secret?

- Philip Oltermann

The first place that Max Schranz moved into after leaving his family home is the kind that many young professionals dream of inhabiting at the peak of their career. At only 26, he lives in a bright fifth-floor apartment with high ceilings overlooking a European capital city, 10 minutes from the central station and within walking distance of cinemas, theatres and bars.

No lottery win or parental trust fund was needed: Schranz, who is a master's student, pays €596 ($654) a month for his 54 sq metre two-bedroom apartment - a fraction of typical rents for similarly sized and located apartments in other major European cities.

What's more, he didn't have to put down a deposit and his rental contract is unlimited - in theory, he's allowed to pass it on to his children or a sibling when he decides to move on. "I'm aware it's a pretty stress-free existence," Schranz says. "My friends in other European cities are a bit jealous." Welcome to Vienna, the city that may have cracked the code of how to keep inner-city housing affordable.

As other cities battle spiralling rental prices, partly fuelled by inner-city apartments being used as short-term holiday rentals or being kept strategically vacant by property speculators, the Austrian capital bucks the trend.

In the place that last year retained its crown as the world's most livable city in the Economist's annual index, renters on average pay roughly a third of their counterparts in London, Paris or Dublin, according to a recent study by the accounting firm Deloitte.