Europe

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Few good choices in Europe

It is hard to find really attractive residential investments in Europe. After over 10 years of property price appreciation, many European real estate markets are expensive, overbuilt, and are now suffering from raised interest rates.

Europe’s big problems:

• Low yields. A simple, sensible cut off point – don’t buy anything that yields less than 5% - leaves just 10 countries.
• Low growth in Western Europe, rising interest rates.

In all honesty we have to say to residential property buyers – have you perhaps considered NOT buying?

Our main country choice:
Turkey Low prices, attractive country, good food. The negative is the political stalemate, which could slow the country’s growth (which is quite high). But Turkey seems to us the ‘best bet’ in Europe.

Not really our choices (but runners-up):
Hungary
The country’s residential markets have been taking a breather due to the government’s gross mismanagement of the economy. Real estate is relatively undervalued and yields are moderately high. However mismanagement has a cost - beware high income and capital gains taxes.

Ukraine
OK, we know that you’re not remotely interested in Kiev - but at the moment, it is the city with the highest rental yields in Europe. However the downside is that it has extremely high inflation, a running quarrel with Russia, and prices are high in terms of local affordability.