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Where are the top property investment hotspots in Europe?

At a time of such political and economic uncertainty, it’s prudent for investors to think about diversifying their property investment portfolio to include property hotspots outside London. There are three countries whose economic, social and infrastructural improvements make them worth considering for substantial long-term property investments.

Spain

Spain recently started showing positive signs of recovery since the 2008 credit crunch and consequently, has been identified as a prosperous hub for property investment. This has led companies like Intu Properties PLC, AEW, and Cogress to expand into the country.

Based on the latest figures from the National Statistics Institute, Spain’s economy has bounced back to exceed its pre-crisis GDP levels. The country’s improved economic performance has put the country back on the radar of many international investors. Property investment has benefited from these trends, with the residential property market receiving significant inflows of foreign, as well as domestic funds.

In addition, four years of rising property transaction volumes, increased confidence in the economy and the future job market, combined with drop-in interest rates and better financing terms and conditions, have propelled property demand, especially in Madrid. Despite the arrival of several institutional investors recently, there is still a shortage of private investment capital, opening the market for future-gazing investors.

The Netherlands

The latest data from the land registry office and national statistics bureau showed that house prices in the country rose 7.4% in April, compared with the year earlier period. This marks the biggest increase in 15 years.

This surge has been partly attributed to Amsterdam’s potential to attract London-based businesses seeking to relocate to continental Europe following Brexit. The boom is also driven by a shortage of properties for sale in Amsterdam and Utretch with construction levels being too insufficient to close the gap between supply and demand.  Like the rest of Europe, low interest rates in the Netherlands is fueling borrowing and house prices. Lastly, the country’s falling unemployment levels, growing economy and high levels of consumer confidence has helped attract foreign investment in the real estate market.

Germany

Investors can simply not overlook the largest real estate market in Europe. Data from Savills shows that housing prices in Germany have been rising sharply in recent years, and experienced a spike following the UK’s Brexit vote. As well, JLL’s Capital Flows Report highlighted the country’s record transaction volume of €12.6bn in 2017 Q1 with logistics and residential taking up an ever-increasing share of portfolios. Low-interest rates have also been driving the increasing number of property mortgages being issued since 2009.

Ahead of the UK’s March 2019 deadline to leave the EU, Frankfurt, the home of the European Central Bank HQ, has seen its house prices increase, as many expect banks and other financial institutions to relocate to the city.

Ultimately, the country’s stability, relatively robust economy, and shrinking unemployment employments has helped shape the perception of the country as a safe haven for investors.

This blog was also featured at Development Finance Today

Always seek independent advice. This blog has not been approved as a financial promotion by Cogress Limited. We are not responsible for the content of external websites. Potential investors must rely on their own due diligence prior to investing.

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2017-08-17T14:51:54+00:00
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