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My Expats World | London Rejected from the 10 best European cities for Property Investment

At the top of the EU property market we find Birmingham, Berlin and Hamburg. London has been overtaken by cities such as Budapest and Istanbul

This is the first time since 2012 that London has slipped out of the top 10 best cities in Europe for investment prospects. Prices are high and yields aren’t as good as they used to be.

PwC Report

A report done by by PwC and the Urban Land Institute, showed that Berlin and Hamburg took the top two positions in the Emerging Trends in Real Estate, while Birmingham came in sixth.

This report collated interviews with more than 500 developers, investors and property managers across Europe and is a useful guide to where experts think the market might be heading
Cities were rated based on investment prospects, and for their impressions on the future of the property market – both residential and commercial.

This year however, London came in one place below Istanbul and two below Budapest, despite their volatile political situations. Enormous opportunities for investors were seen in Istanbul due to its quickly expanding population.

Have London prices reached their peak?

It was suggested that investors are ready to call the market as prices may have finally reached their peak. Yield compression may be at an end or likely to fall off soon according to some investors but some people still see the London real estate market as the best way to preserve their wealth. Despite it having slipped in rank, London is the largest real estate market in Europe.

The cycle

When times are tougher, money tends to plough in because people are looking for a safe bet. Somewhere to keep their money. This is not a slight on the city at all but is just a reflection of where we are in the cycle.

Birmingham

Birmingham was in sixth place for the second year in a row. Companies are starting to move business there, such as HSBC, as well as HS2 because it’s more cost effective in comparison to London.
This city seems that it has finally proven that it is attracting employees and employers from London.

Berlin

Berlin is popular due to its existence as a hub for creative and tech industries. In this city there is a strong demand for office space. Many creative industries are relocating here and there is new infrastructure coming. Berlin has a young international employee base and a lower cost of living which helps drive the city forward.

Paris

Paris has the third most active property market in Europe. However, Paris came in 22nd on a list of 28 cities for investment prospects. The city is deemed “too expensive” and had problems of “political instability”.

International investment

There seems to be an influx of international investment, such as American institutions which are coming into the market of student accommodation. It seems the residential market is going mainstream including retirement living and student housing.

The top 10 European cities with the best investment prospects
1. Berlin
2. Hamburg
3. Dublin
4. Madrid
5. Copenhagen
6. Birmingham
7. Lisbon
8. Milan
9. Amsterdam
10. Munich

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