These are Europe's most expensive residential property markets
Catella, which tracks 58 cities across 16 European countries, reported that the average home price rose 2.1% from Q1 to €5,666 per sqm during Q3. The unweighted monthly average rent rose even more to €19.70 (HUF 8,200) per sqm.
“In addition to the continued strong growth in rental prices, capital values are now also showing a marked upward trend. This is leading to an increasing stabilization of yields, with only isolated minor corrections expected," said Lars Vandrei, Senior Research Manager at Catella Residential Investment Management (CRIM).
We are optimistic about the anticipated momentum in transaction markets, which should help stimulate construction activity.
The most expensive residential markets remain in Switzerland and the United Kingdom.
Geneva remains the most expensive residential market at €15,770 per sqm (+€120), followed by Zurich (€14,000 per sqm) and London (€13,930 per sqm).
In forint terms this translates into prices per sqm of between HUF 5.8 million and HUF 6.5 million.
The most affordable housing prices are found in Finland: Lahti (€1,640 per sqm) and Jyväskylä (€2,380 per sqm).
The analysis presumably does not cover the countries of Central and Eastern Europe and the Balkans, where it is cheaper to buy residential property.
At the same time, London remains the most expensive city for tenants, with an average rent of €37.60 per sqm (+€1.60), followed by Dublin (€35.00 per sqm) and Geneva (€34.70 per sqm). At the lower end of the price scale are Liège, Belgium, and Graz, Austria, with €11.00 per sqm each.
Meanwhile, prime yields for multifamily properties currently average 4.59% (unweighted), slightly up from 4.48% in Q1.
The report points to a worrying trend, namely that the shortage of new homes and rising rents is triggered by a significant slowdown of new permits.
Over the past two years, building permits for residential space across Europe have significantly decreased compared to the previous period — by an average of 23%. Finland (-52%), Sweden (-48%), and Germany (-37%) are among the hardest-hit countries.
On the other hand, Portugal shows stable trends (+4%), and Spain demonstrates a markedly positive trend in new housing permits (+27%).
Cover photo (for illustration purposes only): Getty Images
