The Strategist

Volume of real estate sales in Europe is climbing up

10/12/2017 - 10:51

According to Catella’s study, dedicated to residential real estate, volume of sales of real estate in Europe could increase to € 39 billion in 2017.

Mark Moz via flickr
Mark Moz via flickr
The reasons for the constant increase in sales are urbanization, availability of capital, migration and demographic situation, writes Market Watch. "This is emphasized by the fact that Asian investors have become active in the continental European market for the first time in 2016. Several funds have invested in Spain; UK and German pension funds invest in the Netherlands, 40% of Berlin's residential property is sold to French, Scandinavian and Finnish buyers," says Thomas Beyerle, head of research at Catella. 

The study analyzed 75 cities in Europe. As a result, the Dutch cities of Amsterdam, Utrecht and Rotterdam were given the "metropolis" level with respect to investments in residential real estate. They are followed by Helsinki, Copenhagen, London and Manchester. Malmö, Stockholm and Vienna are also on the high rank line ("cash cows"). Manchester, Oslo, Stockholm, London and Helsinki are classified as "stars." Rome, Porto and Zaragoza are "newcomers" with regard to investments in residential real estate.

"Now and in the future, the presence of investment in the residential real estate market will be more important than finding an ideal opportunity to enter the market," notes Thomas Beyerle.

At the same time, almost 60% of Europeans are confident in the further growth of house prices.

The belief that cost of residential real estate will be rising continues to grow in Europe. But 61% of people believe that houses and apartments are unjustifiably expensive, and one in five is struggling with the actual prices.

According to the annual reports of ING International Survey Homes and Mortgages 2017, the belief that prices for housing will be growing has increased for the first time in two years. In particular, the figure currently reaches 20% (up to 72%) in Romania, 14% (up to 66%) in Spain and 65% in the Czech Republic. On the other hand, expectations in the UK fell sharply. The proportion of people who believe that the value of real estate will grow over the next 12 months, decreased by 13% since 2016: from 57% to 44%, according to PropertyWire.

However, because of rising prices, many consumers, albeit with a false sense of security, did not calculate their budget correctly. About 41% of respondents report that their current home has barely fitted into their budget or exceeded it. 23% of all surveyed Europeans said that their current expenses are higher than they expected, and 20% have difficulties with managing housing payments.

According to ING International Survey Savings 2017, 29% of people in Europe do not have any savings at all. The current trend can lead to the fact that all the money that they can save will go to pay bills. In the current study, only 29% of people in Europe agreed that their country was on the right path of development in terms of housing, and 45% answered negatively.