Europe’s best emerging real estate markets
Although several European countries are still recovering from property and economic crises, international investors are still bullish about the European real estate market, driving further growth in several European property markets. Whilst London, Geneva, Paris and Monaco continue to command Europe’s highest property prices, other cities are emerging as increasingly popular with international buyers, offering excellent investor returns. But anywhere in Europe, you still have the potential for a better economy and higher inflation positively influencing your investment. This is the main reason why real estate in continental Europe and recovering markets has performed so well. But if the usual big players in European real estate aren’t for you, then maybe these emerging markets may be just what you are looking for.
Analysis of the market in Zagreb, the capital of Croatia, shows great promise, presenting all indicators that the market will reach a tipping point in future years to see explosive growth.
Asking prices for condos in this city increased by 20% in 2018 when the rest of the country only saw increases of 8.5%. Furthermore, in the past year there has been a 30% increase in homes being advertised on Airbnb in Zagreb, indicating the demand for vacation rentals is experiencing a surge as well. The country has also launched a new reform under which, the average time to register mortgages and property transactions has decreased from 46 days to 12 days in Land Registry Offices (LROs) and from 30 to 8 days in Cadaster Offices (COs), ensuring an easier and more straightforward purchasing process. But if you’re a foreigner looking to invest in Zagreb you’re in luck. Croatia, a member of the European Union since 2013, has a reciprocity law enabling foreigners to buy property without restrictions as long as Croatian citizens have the right to acquire property in the buyer’s home country or state.
What has long been seen as a vacation destination, the city of Lisbon has recently seen demand for property purchases sky rocket. This is in part due to the golden visa system where foreign buyers who invest €350,00 in underdeveloped areas or €500,000 in upmarket places can gain a fast track to citizenship as well as a favorable tax rate for new high-earning residents. Prices increased 20% in just the past year. The city already sees a lot of interest in new luxury high end developments from South African, German, Chinese and French buyers and there is increasing interest from Canadians, Americans, Brazilians and Italians. The Portuguese market requires more work today than it did a few years ago, but it’s worth it. The numbers of both tourists and foreign retirees choosing to spend time in this country is rising and will continue to do so. Overall, this is a stable country with a strong economy. Note that it’s possible to get a local mortgage as a nonresident for the purchase of property in this country.
Squeezed between the Balkan and the Rodopi Mountains, Bulgaria’s second-largest city has survived for thousands of years on the crossroads between Western Europe and the Middle East. Plovdiv, was just named the European Capital of Culture by the European Union which means the city is a major focus for the next twelve months and a number of urban revitalization projects are already underway. Sofia, the capital, is also seeing growth with a new metro line in the southern part of the city and a rep from the in-country brokerage Unique Estates says neighborhoods like Vitosha and Krastova vada are becoming residential centers once more after being largely industrial areas. Price trends in Plovdiv are consistent with the capital city of Sofia, where mid-priced homes saw an increase of about 9% last year. Homes in the luxury segment saw an increase of 6%. While these aren’t double digit growth numbers, the amount of investment that comes from being the Capital of Culture will make these numbers rise significantly in just a year’s time.
The Netherlands is unusual in that the housing market in its capital city of Amsterdam consists of 70% rentals so the inventory for buyers is very low, but there are other large urban areas worth investing in. About an hour from Amsterdam, and half an hour from The Hague, sits the growing metropolis of Rotterdam where prices increased 17% compared to last year, outpacing the national average of 10%. They also sold within an average of 33 days on market, which is 11% faster than the year before, according to data from VOC International. Home prices in Rotterdam average €271,000. With an estimated cost of living at 11% lower than Amsterdam, it is unsurprising that expats are now turning to Rotterdam to find a home. Since Rotterdam properties cost on average just €2-4,000 per square meter – cheaper than The Hague and Utrecht, and around half of what you can expect to pay in Amsterdam – expat customers seeking more space close to Rotterdam city centre or in striking distance from The Hague are getting much more for their money. Even Amsterdam is just a 40-minute commute by train. House prices in Rotterdam increased by 27% in the last two years and continue to rise. The giant has woken, and now expats begin to do so too. Prospective buyers may need to act fast.
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