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Real Estate in Europe

The European real estate market in comparison

We just jumped into the year 2020 and curious to know how the real estate market in Europe was doing last year? Maybe we can find a tendency that is a must-know for our real estate strategy.

When making my research I came across a very interesting report that really opened my eyes to a few surprising facts regarding the real estate in Europe. I can recommend this to everybody to have a read.

Property Index – Overview of European Residential Markets

https://www2.deloitte.com/content/dam/Deloitte/de/Documents/real-estate/property-index-2019-2.pdf

Also, they will regularly post new reports – so you can keep up with new developments. “Data is the new gold”, so they say and I believe they are right. Acting according to the data provided can give you a big advantage.

Here are some results from this report I found very useful.

Since 2015, growing prices were seen in 15 (from a total of 16 EU countries). Italy being the only exception. There, property prices have been falling gently but little by little for years.

The typical annual growth in European property purchase prices has been 5 percent over the past three years.

In Eastern European countries (the likes of Hungary or the Czech Republic) and in Portugal, however, this increase was almost twice as high, which makes it increasingly problematic for people in these countries to acquire real estate in view of the lower income levels. In Eastern Europe the price growth may be seen as catch-up growth. Also, price developments are motivated in particular by the low interest rate environment. The “cheap” money fuels the property prices on one side, but also increases debt on the other.

The purchase price index between urban property prices and those in the countryside continue to separate and continue to show the ever more differing development of purchase prices between urban and rural regions. Just to look at one example, property prices in German cities such as Berlin, Frankfurt and Hamburg exceed the national average by half; Munich has the highest German value at 130 percent. Looking at Europe as a whole, Munich is not the only one: in a European comparison Paris and Lisbon (both about 220% above average) and London (198%) show an even more extreme development.

Are you looking for a great real estate bargain in Europe?

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Property transactions costs comparison between the US and Europe

I recently read an article which indicated that transaction costs for US property average between 9 and 10%. This seems staggeringly high to someone like me who is more used to costs around 2%.

The seller has to pay the majority of the US transaction costs and the largest part by far is the Real Estate Broker fee which is typically 6%.

Similar costs in Northern Europe are between 1.5 and 3%. Other overall costs are pretty comparable and consist mostly of taxes and legal fees.

Continue reading Property transactions costs comparison between the US and Europe

Property Depreciation and why Europeans have never heard much about it!

Here is an interesting thing I realized recently as a result of living in the US. In the US property depreciates. As a result you can write off the cost of the depreciation against rental income (typically over 27.5 years).

This deduction is not possible for those living in Europe. Why the difference?

Is it because of differing building standards. Generally more buildings are timber frame in the US verses block build in Europe thereby affecting their lifespan? Continue reading Property Depreciation and why Europeans have never heard much about it!

An Overview of Expected Property Price Growth in Europe

I was reading an article recently which reviewed a recently published S&P report. It indicated that 3 countries are set to led the price growth in property: Ireland, Portugal, and the Netherlands.

It appears the price growth in these countries is as a result of a shortage in supply.

The report predicts that the top 3 countries will continue to see growth in property prices until at least 2020. For the coming year it predicts growth of 8.5% in both Portugal and Ireland with the Netherlands close behind. Continue reading An Overview of Expected Property Price Growth in Europe

Rent a room to earn income and save tax

It appears most countries across Europe now have a scheme whereby you can rent a room in your house and the income earned is tax-free up to a threshold.

This is certainly something worth considering as many countries charge a crippling tax rate for rental income or for many people the extra income pushes them in a higher income tax rate. Effectively this means they may be paying back almost half the extra income in tax. Continue reading Rent a room to earn income and save tax

You need as little as £20k to get on the property ladder

If you think you will never be able to put together enough money to get on the property ladder …think again.

It normally takes a few years saving up for a deposit and than to be able to demonstrate you have the ability to meet your monthly payments on a mortgage.

Continue reading You need as little as £20k to get on the property ladder

If you are able to demonstrate that you have ancestors from Europe, in many cases you can be entitled to citizenship. Continue reading How to get European citizenship

Where are the cheapest houses in Europe? Find cheap properties in Europe

Here you can see all cheap properties in Europe on a map. That makes it easy to locate the hotspots for cheap property in Europe. The question is: How much is cheap? Continue reading Where are the cheapest houses in Europe? Find cheap properties in Europe

Category: property in Europe