In the past decade, the European real estate market has seen a period of economic crisis, but it has slowly started to grow again in recent years. Buying a property in a European city is a pretty smart idea during this COVID-19 era, compared to all the other markets, which seem to be fluctuating.
Real estate can be seen as not just an investment, but also it’s a way of putting your money into a bank with a high-interest rate. While the exact impact of COVID-19 remains unclear, some European cities are already emerging as more resilient than others when it comes to the property market. The real estate business in Europe has some fantastic opportunities for investors, especially in the following cities listed. Read on to see the best choices for your real estate investment, and why they can benefit your pockets.
Why Invest in European Property?
Property across European cities is a lucrative market. Compared with smaller towns and rural villages, cities have higher numbers of people living there and, thus, there is always a high demand for rental property and real estate to house a city’s population. The attractiveness of cosmopolitan areas such as Barcelona always has high sway when it comes to investments.
A few years ago, everyone was predicting the end of Europe, but we have recently seen ever-increasing property prices as investors flock to the markets. Places like Berlin, Paris and Amsterdam are the cities that are experiencing high numbers of growth. There’s no denying that European real estate is in extremely high demand, and it’s an interesting asset class.
Europe’s Best Cities to Invest in Real Estate
Here are some of the best cities to invest in when it comes to property.
Since 2014, properties for sale in Barcelona, Spain, have shown a sharp increase in demand for investment properties. The Catalan capital has seen an increase in tourism; Barcelona has a wide appeal to many travelers and has been named one of the most attractive to visit in Europe, with more than 7.5 million tourists annually.
The demand for tourism has seen a massive increase in the change of old, derelict buildings and office blocks to swanky hotels and rental properties. The city is also starting to see a large number of non-Spanish citizens move to the area for work. As a result, the real estate market has seen a sharp increase in the demand for investments in the Spanish city.
Currently, Paris is one of the leaders in real estate, and this is due to the Great Paris Project. The city is planning to invest €30,000 million into the sustainable development of the region’s economy and employment with a view to maintaining and strengthening the Greater Paris Region’s position among the most attractive international cities.
As part of the project, the French government is aiming to build 70,000 new homes per year to confront the widespread housing crisis and compensate for the low level of housing production. House prices in Metropolitan France have risen 5% over the past year when tourism and lockdowns around Europe have hurt other parts of the continent’s economy.
As a whole, Germany is well known for its stable economy, and its capital, Berlin, has long been one of the top cities for European real estate. For the past five years, Berlin has seen a big housing boom, with the growth of house prices almost doubling compared with that in France. The future of property in Berlin is a very optimistic one for anyone looking to invest. Germany has managed to avoid the damage caused by the past two financial crises, the 2008 global crisis and the most recent one associated with COVID-19.
Amsterdam is fast becoming one of the best places to invest in Europe. The price of apartments, detached, semi-detached, terraced, and corner houses in the Dutch capital have all shown an increase between 6% and 9%. Likewise, interest rates are low and after the coronavirus pandemic, there are more than 2,500 transactions of houses every week within the country. The lack of houses in the capital is the main reason for the promising situation. Along with the low-interest rates, this gives investors a very vivid picture of the real estate market in Amsterdam!
Manchester is making a name for itself in the European property market. A firm favorite with many investors, it’s often referred to as the ‘London of the North’ with new infrastructure and the UK Northern Powerhouse development increasing its popularity. As a result, in 2017, Manchester made it onto the top ten global destinations for foreign investment.
The city experiences a steady influx of young people into the city, second only to London, and as a result, real estate investments reflect that. Property prices have increased by 30% in Manchester over the past five years and it is estimated that 30% of housing in Manchester is in the private rental sector. In addition, rental yields currently stand at 8 percent.