Market Report Property

December 9th, 2015   •   Comments Off on Market Report Property   

Real estate investment in countries such as Portugal and Cyprus is beginning to look attractive as markets start their recoveries.

Prices of real estate fell significantly in many European markets after the credit crisis started in 2008. After several years of recession, economic growth returned to the EU in 2014 and European countries are beginning to show strong recovery. On the back of this economic recovery, real estate prices are rising from all-time low points.Price-Income Ratio European Property

Property prices in Portugal rose 2.8% in the six months to 30th September 2015. A recent forecast from the University of Barcelona predicted property price rises in Spain of 12% in 2016 and as much as 50% over the next four years.

Price to income levels in Portugal and Cyprus in particular are some of the lowest in Europe suggesting upside as the market continues its recovery.

High rental yields in Spain, Portugal and Cyprus.

Rental yields are high in Portugal after traditional middle class buyers were kept out of the market post credit crisis due to lack of bank lending. There are many years of pent up demand from buyers who have been forced to hold back and rent their property rather than buy. The real estate cycle has reached a new phase in these countries and there is significant scope for catch up with the rest of Europe.

Countries such as Spain, Portugal, Greece and Cyprus have significant scope for capital growth in the coming years. Banks are lending again and improving economies are bringing domestic buyers back to home ownership.