Jan 23, 2017
As a result of the 2008 financial crisis, the Bank of England and European Central Bank dropped interest rates to historic lows and made the property market very appealing to investors. The central banks even pumped some money into economy which increased the demand for property. London then became a fond favourite for investors, but as demand rose, so did the property prices which in turn have made London less appealing as the potential returns are now much lower and investors are starting to look elsewhere. This opens up much of mainland Europe as a prime opportunity for investment, and here we take a look at some of the most popular.
Since the 2008 crisis, the Hungarian property market has proven itself to be more resilient than most of the neighbouring Mediterranean countries, especially Spain. By the last quarter of 2015, Hungarian house prices had grown by more than 10% year on year. Budapest and Lake Balaton are among the most popular destinations for investment, as are the nearby resort towns of Héviz and Keszthely as they are very popular with tourists. Apartments could set you back €600-1,400 per square metre while houses range around €1,000-2,500. Construction approval permits have increased by 30% over the past couple of years while GDP is estimated to continually grow at a rate of 2.5% through 2016. Remember to fill an E111 form before travelling to Croatia, for business or pleasure. Once approved you’ll be entitled to healthcare on the same basis as Croatian citizens, should you require it.
Expansion is the name of the game in the Portuguese market as their prices grew by 5% between 2014 and 15. Lisbon and the Algarve are the runaway most popular markets for investors, especially as the area attracts a large number of tourists every summer. Unemployment rates are set to decline through 2017, and property investment in the area can surely only have a positive effect on this cause. Investors can expect to pay €800-3,800 for apartments and €650-3,500 for houses. GDP in Portugal is admittedly not as strong as Spain’s but it is still expected to grow by 1.8% in 2017. There was a 17% rise in construction permits in 2015 whereas commissioned buildings only made up for 7% of the country prior to the financial crisis.
Spanish property was considered the hottest in Europe prior to 2008, and it has taken almost eight subsequent years for the market to repair itself. Now is the best time to invest in Spanish property again after it rose by 4.3% by the end of 2015 and that number is only set to rise. Understandably, Valencia, Catalonia, Madrid and the Canary Islands were the most popular areas among 70% of all foreign buyers. Building permit approvals have jumped by an astonishing 50% compared to 2014 with the country’s GDP also set to rise by 2.5% in 2017. €1,000-3,000 is the going rate for apartments, while houses are selling for €1,200-3,000. All experts are suggesting that it is wise to buy now while the rates are cheap and watch their value increase in the coming years.