Property Index Overview of European Residential Markets 9th edition, July 2020 - Deloitte
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Property Index Overview of European Residential Markets 9th edition, July 2020
Property Index |
9th edition, July 2020 Property Index |
9th edition, July 2020
Introduction
Introduction 3 We are pleased to present you the ninth edition of
the Property Index, Overview of European Residential
Highlights 5 Markets. During almost a decade, Property Index has
become one of the most important and popular European
Impacts of the Coronavirus Pandemic real estate publications and has acted as a valuable source for
on Residential Markets in Selected Countries 6 professionals, institutions and general public.
Economic Development in Europe 7 Property index analyses factors shaping the residential markets
and their development and compares residential property
Comparison of Residential Markets – prices across selected European countries and cities.
Housing Development Intensity 10
The publication aims to provide you with European residential
Comparison of Residential Property Prices market data on a regular basis and to answer questions on how
in Selected Countries and Cities 15 Europeans live and at what costs.
Mortgage Markets in Europe 30 Despite the fact that the publication’s focus is to provide
a complex overview of the past year’s development on
Annex: Comments on Residential Markets 32
residential markets in European countries, we could not ignore
the current unprecedented situation caused by the coronavirus
Contacts 45
pandemic. We included a brief overview of early impacts of the
pandemic and related measures on residential markets in the
Authors 46
participating countries and their expected future development.
We hope you will find this edition of Property index interesting
and that it will provide you with insights and information you
need.
2 3
Property Index |
9th edition, July 2020 Property Index |
9th edition, July 2020
Highlights
This year, we analyzed residential markets This edition of Property Index has the
in: historically highest number of participating
countries with Bosnia and Herzegovina,
•• Austria (AT);
Bulgaria, Ireland, Israel, Luxembourg,
•• Belgium (BE); Serbia and Slovakia joining the publication.
•• Bosnia and Herzegovina (BA);
Most presented indicators are on a year-
•• Bulgaria (BG);
7,145 EUR/sqm
on-year basis and are to some extent also
•• Croatia (HR);
•• Czech Republic (CZ);
influenced by geopolitical situation and
various factors affecting the volume of Oslo
supply and demand.
Luxembourg took the position of the
-7.4%
•• Denmark (DK); most expensive country in terms of new Prices of new dwellings
A proven international and cross-functional in Norwegian capital
•• France (FR); apartment prices in 2019
team of Deloitte professionals in the Oslo decreased by 9.0%
•• Germany (DE); development, mortgage and real estate year-on-year
markets prepared the Property Index. This Average transaction
•• Hungary (HU); publication has been prepared using data price of new dwellings
collected by individual Deloitte offices in in Serbia decreased
•• Ireland (IE);
the participating countries. by 7.4% between 2018
•• Israel (IL);
•• Italy (IT); Property Index capitalizes on Deloitte’s
11.4 and 2019, which is the
biggest fall among
extensive knowledge of the real estate compared countries
•• Latvia (LV); For the fourth time in
and development industry, enabling us to
•• Luxembourg (LU); provide you with independent and credible a row, homebuyers
information. in the Czech Republic
•• Netherlands (NL);
12,863 EUR/sqm
had pay the highest
•• Norway (NO); multiple of their annual
gross salary to purchase
•• Poland (PL);
a 70 sqm dwelling
Paris remained on the position of the most expensive city to
•• Portugal (PT);
purchase a square meter of apartment in Europe before Tel Aviv
•• Serbia (RS); and Luxembourg City
•• Slovakia (SK);
•• Spain (ES); and
•• United Kingdom (UK). 164%
Housing prices in Lisbon and
Porto were on average 164%
higher than the national average,
550 EUR/sqm
which is the highest deviation
among participating countries With 550 EUR/sqm of a new dwelling,
Bulgaria had the lowest prices among
countries in the Property Index
30.71 EUR/sqm
Luxembourg City, a new entrant into the publication,
was the most expensive city in terms of monthly rent
4 5
Property Index |
9th edition, July 2020 Property Index |
9th edition, July 2020
Impacts of the
construction works might be the shortage Transaction activity in Q2 2020 is expected Curious circumstances can be observed
of labor, especially in countries, where to be significantly lower than in the previous on the real estate market in Bosnia and
most of the construction workers are years on most of the selected markets. Herzegovina. Its future development
from abroad and returned home after the A decline will be caused by uncertainty is closely intertwined with economic
Coronavirus Pandemic
outbreak of the coronavirus. in terms of economic and epidemiologic development of Western Europe, as big
development that might encourage share of buyers are from the numerous
Rental markets in most of the participating potential buyers to postpone their decisions BiH diaspora living and working abroad.
countries demonstrated the fastest into safer times. Moreover, most of the A similar phenomenon, although to
response to new circumstances on the banks across the participating countries a smaller extent, is to be seen also on other
on Residential Real Estate
market. Especially in major cities, such have already applied stricter conditions, eastern European real estate markets.
as Paris, Rome, Prague or Budapest, such as lower LTV ratio or higher disposable
restrictive measures effectively stopped income of applicants, on new mortgage The current unexpected situation brought
the inflow of tourists and many of loan applications. On the other hand, several restrictions into the functioning of
Markets
apartments located in city centers, interest rates of almost every central bank in the residential real estate market. In the
originally used for P2P accommodation Europe are close to zero, which means that immediate future, numerous technological
services, were introduced to the long-term mortgage interest rates will remain low for solutions could emerge and change the
rental market, which created a pressure on the upcoming period. This might encourage unwieldy processes on the market. In many
rents to decrease. However, it is uncertain, people with stable income to invest into countries, virtual property inspections
whether these dwellings will return to the residential real estate. via video calls were enabled to tackle the
How did residential markets in selected countries react to short-term market once tourism activity social distancing measures. The pandemic
recovers. In terms of price development, most might change the way people think about
the outbreak of the virus and what is expected to happen countries expect property prices to housing. Spread of the option to work
in the near future? The development of the residential real stagnate or undergo a slight correction remotely will possibly redirect part of the
estate market across Europe varies in 2020 before returning to growth in demand from cities into more peripheral
from country to country. In ten out of 2021 or 2022. Most positive outlooks are regions and adjust price levels across
23 participating countries, stagnation is in countries with limited available land countries to be more even. Furthermore,
After several years of growth across all and developers are in a better financial although a slight delay in permitting
expected on the residential market in terms bank, which are also attractive for foreign implementation of technologies such as
segments of the real estate market, year condition than on the edge of the previous processes and construction may occur,
of price and a decline in terms of transaction professionals, such as Luxembourg, electronic validation of contract certificates
2020 was anticipated to confirm this trend. crisis. there must not be a significant outage of
activity. Experts from six countries have Belgium or the Netherlands. Contrary, via block chain may become part of the
Nevertheless, since late December 2019 production in order to protect the housing
negative expectations in terms of price a steep decline is expected in the sales process together with virtual reality
a new type of coronavirus started to spread We asked our real estate experts from market. The role of government help, either
development and overall market activity United Kingdom after the market fully tours in development projects currently in
across the world from China. In February participating countries to share their in form of guarantees or direct financial
in the future. These countries being ones, understands the economic impacts of construction.
and March 2020, most of the European thoughts and observations about the involvement, will be crucial to tackle this
which were hit hard by the virus (the United the pandemic and the still uncertain
countries were hit by the pandemic and immediate impacts the coronavirus had imminence.
Kingdom, Croatia) or ones with already form of Brexit. Hungary also expects This crisis gives the whole market a new
were forced to impose restrictive measures on the residential markets and how will
slowing markets (Hungary). Contrary, an accelerated decline on the already perspective on how people across Europe
on their economies and the free movement markets develop in the upcoming months. Immediately after the implementation of
a positive outlook is being articulated by cooling residential market. Other live and has a potential to change it.
of citizens. Together with the rest of the protecting measures in the participating
representatives from countries, which countries that will be negatively affected
economy, residential real estate market has During the past crisis, we witnessed a huge countries, residential markets in most
have strong fundaments for further by the protective measures and cautious
also been affected. shrink in construction activity, when many of them effectively froze. The majority
development of the residential market. behavior of people will be traditional
developers had financial problems and of pending transactions, which were in
These countries being Belgium, where summer holiday destinations as Croatia,
The economic crisis that will follow the most of the projects were put on hold. early phases of the process, were put on
prices were growing constantly for the last Spain or Italy, whose economies are
pandemic is expected by many experts to This resulted in record low numbers of hold. Almost no new deals were initiated,
37 years, the Netherlands, Norway, Israel, highly dependent on tourism. Especially
be the worst since the Great Depression. initiated and completed dwellings in years as personal property inspections were
Slovakia and the Czech Republic. In any case, prices of second homes in these
However, from the perspective of real after the crisis, which in combination with almost impossible to perform. Some
these predictions were made with currently countries might decrease significantly, as
estate market, this crisis is different from low financing costs and economic upturn countries reported a year-on-year decline
available information on the epidemiologic demand will be weak.
the previous one in years 2008– 2010. kick-started the residential price growth in transactions by up to 80%. The effect
and economic situation and might change in
Negligence of banks in terms of property across Europe and deepened the shortage on construction activity varied between
case of unexpected events.
financing and consequent trading of of dwellings in several countries. Our countries based on the tightness of
derivatives based on these loans caused experts agree that in case of a long-lasting protective measures. For example in
the financial crisis. The current economic economic downturn, a similar pattern may France, works on 90% of construction
downturn have been caused by disruptions appear on some markets. Nevertheless, sites were interrupted, while in the Czech
from the government’s side to prevent development companies are in a better Republic, workers only needed to adapt to
the spread of Covid-19 disease. Banks position to handle complications and additional hygienic rules. Another threat to
6 7
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9th edition, July 2020 Property Index |
9th edition, July 2020
The only positive thing about the recession Fiscal policies of EU countries reacted to As government debts of several European
is that inflation is not a concern. Weak recession in two ways – automatically and countries were not on a sustainable
demand and low oil prices will keep discretionary. Automatic reaction means path even before outbreak of COVID-19
Economic
inflation close to zero (maybe even in that government budgets run deficits pandemic a renewal of sovereign debt crisis
negative territory). HICP inflation reached whenever economies fall into a recession cannot be ruled out. European wide 750 bn.
only 0.1% in May. and they stabilize economies by doing so. EUR fiscal stimulus is in preparation.
Apart from that, governments support
ECB reacted swiftly to the crisis. It cut the economies by discretionary measures. Apart from COVID-19 caused recession,
deposit rate by 10 bps to -0.5%. Moreover Mainly employment subsidies (“Kurzarbeit”), European Union faces other problems –
Development
it renewed asset purchases programs and postponement or remission of tax trade tensions, and Brexit. Great Britain left
and also affirmed that it would prevent payments are used. Credit guarantee the EU on 31st January. Transitional period
unjustified increases in costs of debt schemes are also utilized. Aim of the above will expire on 31st December 2020. In the
financing of Eurozone countries through mentioned measures is to strengthen cash meantime, a trade agreement must be
bond purchases. flow of firms and households that was negotiated. Therefore no-deal Brexit is still
significantly hurt by lockdown of economies. a real possibility.
in Europe Growth of Real GDP in EU 28 (%)
4%
3,2%
2.7%
2.3%
1.8% 2.0% 2.0%
2% 1.5%
The economy of Eurozone has been
growing for 6 years since 2012–2013
activity in the Eurozone restricts export
demand for manufacturing production.
The resulting 0.3%
Eurozone Sovereign Debt Crisis. However,
this economic boom has been terminated
As a result, we forecast the Czech GDP
to drop by 10.0% this year, i.e. even more
economic recession 0%
-0.4%
by COVID-19 pandemic that has spread
from China to the entire World. Europe
than Italy and Spain. Preliminary data
about GDP in Q1 2020 confirm that decline
will be even deeper -2%
was one of the worst hit region, especially
countries Italy and Spain. To combat the
of Czech economy will be deep as Czech
economy contracted by 3.3% in qoq terms
than 2008–2010
-4%
pandemic severe lockdown (restriction
of movement) of economies had to be
versus contraction of EU economy by 3.5%
and of Eurozone by 3.8%. We forecast the
Financial Crisis.
imposed. The resulting economic recession recovery to be fast but the pre-crisis level -6%
will be even deeper than 2008–2010 will be reached probably as late as in 2022
-6.3%
Financial Crisis. Services are hit to greater provided no further lockdown is necessary.
extent by lockdown than manufacturing -8%
which is evident from developments of The trend of improving labour market 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
purchasing managers' indices. situation is over. The labour market
situation will worsen again because of
Source: Eurostat, Deloitte forecast
The economy of Eurozone is forecasted to a deep recession. The unemployment rate
decline by 6.3%. The downturn will be the in EU will jump to roughly 10% this year
deepest in countries that were severely hit from a record low of 6.3% last year. Relief
by the pandemic – Italy where decline by can be expected next year provided a next The housing market is usually sensitive coming months and years. On the other
9.1% is expected and Spain with expected wave of the pandemic does not arrive. to economic conditions, especially GDP hand, the accommodative monetary policy
decline by 8.0%. The German economy, growth and interest rates. Correlation of the ECB and other central banks in the
the biggest trading partner of the Czech Closure of borders and localization of between lagged GDP growth and house EU will keep interest rates at low levels that
economy, is forecasted to decline by supply chains paralysed international prices in the EU reached 83% during the will be supportive for the housing market.
7.0%. The Czech economy was affected in trade much more than trade disputes did last 10 years. Thus, the economic downturn
two ways – domestic lockdown restricts in recent years. A deep decline of foreign is likely to reduce house prices in the
services (mainly hospitality and catering, trade turnover can be expected.
and tourism) and decline in economic
8 9
Property Index |
9th edition, July 2020 Property Index |
9th edition, July 2020
Completed dwellings Bulgaria, whose population has decreased 1,000 citizens. Latvia and Bulgaria followed
The indicator of housing development by over a million since year 2000. with 3,300 and 4,500 completed dwellings
intensity on the residential market shows respectively.
the number of completed dwellings per Contrary, the highest number of dwellings
1,000 citizens in a given country. Due to per 1,000 citizens, over 11, had been The lowest development intensity could
differences in population of the participating completed in Luxembourg, followed by be observed in Balkan countries, where
countries, recalculating the indicator to France with 6.7 dwellings per 1,000 citizens. the population is decreasing due to the
per 1,000 citizens allows to compare the migration of workforce into western
development activity between them. In terms of absolute values, France defended European countries.
its position of European leader in dwelling
Five countries, Bulgaria, Bosnia and completions with almost 450,000 dwellings Among central European countries,
Herzegovina, Portugal, Spain and Latvia delivered to the market in 2019. Germany Poland retained its position as a regional
had less than two completed apartments and Poland followed with 293,000 and leader both in terms of completions per
per 1,000 citizens in 2019. However, 207,500 completed apartments respectively. 1,000 citizens (5.4) and total number of
Portugal, Bulgaria and Spain are among four completed dwellings (207,500).
countries with the highest housing stock Only 2,900 dwellings were completed
per 1,000 citizens, so these countries might in Bosnia and Herzegovina in 2019,
not need to expand it. Especially in case of which translates into 0.9 dwellings per
Housing Development Intensity
Index of number of completed dwellings per 1,000 citizens
14
7.3
12 11.65
Comparison
10
of Residential
449.4
8
50.6 30.4 6.70
207.5
59.5
5.66
Markets – Housing
6 21.2 5.41 5.54
70.7 5.18
293.0 20.2
36.4 4.35
16.8 4.06
178.8 3.53 3.70
4 3.41
Development
21.1
3.3 2.89
71.6 2.65
14.4
2.16
2.9
4.5 1.73
2 1.52
1.40
Intensity
0.88
0.64
0
BG BA PT ES LV HU UK DK CZ DE SK NL IE BE PL IL NO FR LU
Number of completed dwellings per 1,000 citizens Total number of completed dwellings (ths.)
10
Source: Deloitte national offices
10 11
8
2
Property Index |
9th edition, July 2020 Property Index |
9th edition, July 2020
0
14
10
Initiated dwellings the smallest country participating in the On the other hand, twelve countries Housing Stock Another three countries, Slovakia, Poland and followed by France (35.67 mil.) and Italy
Similarly, as in terms of completed dwellings publication, as countries with less than reported an increase in residential The overall size of the housing stock, along Luxembourg, had less than 400 dwellings (35.09 mil.).Spain (25.78 mil. dwellings), the
12 1,000 citizens, Luxembourg recorded
per 10,000 initiated dwellings. construction activity. Initiated dwellings with its quality, can be generally seen as per 1,000 citizens. However, Poland and United Kingdom (24.35 mil.) and Poland
8
also the highest number of initiated grew by 31% year-on-year in Croatia from an indicator of quality of life and level of Luxembourg were also among countries (14.82 mil.) were also countries with more
dwellings per 1,000 citizens, 8.9, which made As in terms of completed dwellings, the 11,500 to 15,200. Intensive acceleration economic development of a country. with high development intensity, hence their than 10 mil. dwellings.
up for 5,600 started dwellings. Poland and highest absolute number of initiated could be also seen in Portugal (+18%), housing stock is expected to grow.
10
France followed with 6.2 and 6.1 initiated dwellings was in France (410,300), Poland Ireland (+17%) and the Czech Republic The highest stock per 1,000 citizens could Contrary, the smallest stock was reported
6
dwellings per 1,000 citizens respectively. (237,300) and Germany (219,500). These (+17%). be found in Portugal and Italy with slightly Portugal, Bulgaria and Spain were countries in Luxembourg with 244,000 apartments.
three were the only countries with over over 581 dwellings. That is almost twice as with relatively large housing stock per 1,000 Less than three million dwellings could be
8 lowest new construction intensity was
The 200,000 initiated dwellings. Germany As in terms of completed dwellings, Poland big as housing stock in Israel, where there citizens and the development intensity also found in Slovakia (2.06 mil.), Ireland
recorded in Bulgaria, with only 0.1 initiated had lost the second position from 2018 had shown the highest development were only 293 dwellings per 1,000 citizens. in terms of both initiated and completed (2.06 mil.), Norway (2.58 mil.), Denmark
4
dwellings per 1,000 citizens in 2019, which because of a 37% fall in the number of intensity among central European Israel reported by almost 70 apartments dwellings (2.68) and Israel (2.68 mil.).
translates into less than 1,000 started initiated dwellings. countries, leading by over two dwellings less than in the United Kingdom, which had
6
apartments across the country. Bosnia per 1,000 citizens before Slovakia. As the the second lowest number of dwellings per The largest housing stock could be
and Herzegovina and Latvia had 1.2 and Double-digit decreases in new largest country in the region, having more 1,000 citizens with 361 apartments. found in Germany, 42.54 mil. dwellings,
2
1.3 initiated dwellings per 1,000 citizens development intensity had also been than twice as many initiated dwellings as
in42019 and 4,000 and 2,500 started recorded in the Netherlands (-18%), United Hungary, Slovakia and the Czech Republic
dwellings in total respectively. Kingdom (-10%) and Belgium (-10%). combined.
Initiations also decreased in Hungary, 0
Bulgaria, Bosnia and Herzegovina and Denmark, Slovakia and France.
2
Latvia are accompanied by Luxembourg,
Housing Stock
Number of dwellings per 1,000 citizens
0
700
Housing Development Intensity 35.09 5.97
3.96
Index of number of initiated dwellings per 1,000 citizens 4.82 25.78
600 35.67 581.3 581.5
42.54 566.2
5.6 548.3
10 5.51 2.58 541.5
531.9
4.46 2.68 4.98 511.8
8.92 7.81
500 2.06 480.6 480.9
455.9 460.7 465.2
0.24 449.0
2.06 14.82
8 422.6
24.35
410.3 237.3
31.8 386.2 390.6
400 378.0
50.8 360.6
26.2 6.18
6.12 2.68
56.1 5.92
6 5.56
5.37
293.2
21.5 4.89 300
38.7 15.2
35.1
57.2
137.4 17.1 3.94
4 3.62 3.73
219.5 3.59
151.0 24.0 3.28 200
2.92 2.93
2.64
2.5 2.24 2.34
4.0
2
1.31 100
1.0 1.20
0.14
0 0
BG BA LV UK PT DE ES DK NL HU CZ HR SK BE IE IL NO FR PL LU IL UK SK PL LU IE NL HU DK CZ BE NO DE FR AT ES BG IT PT
Number of initiated dwellings per 1,000 citizens Total number of initiated dwellings (ths.) Number of dwellings per 1,000 citizens Total number of dwellings (mln.)
700
Source: Deloitte national offices Source: Deloitte national offices
14
12 13
600
12
Property Index |
9th edition, July 2020 Property Index |
9th edition, July 2020
Comparison of Residential
Property Prices in Selected
Countries and Cities
The ninth edition of Property Index covers Depreciation or appreciation of national and Hungarian forint by 2.5% and 1.8%
data from 23 European countries and 67 currencies other than Euro are shown in respectively. There were virtually no changes
cities. In order to harmonise the outcomes, the chart below. The largest year-on-year in the average annual exchange rates in
all price statistics are calculated in Euros. difference have been seen in Israel, where relations between Euro and Croatian kuna,
However, besides market movements, the Israeli new shekel appreciated by over Czech koruna and Bosnia and Herzegovina
annual prices changes were also 4% against Euro. On the other side, Euro convertible mark.
influenced by changes in exchange rates. appreciated against Norwegian krone
Euro Exchange Rates Changes, annual changes
(+%) = Euro appreciation, (-%) = Euro depreciation
EUR/NOK
2.47%
EUR/HUF
1.83%
EUR/PLN
0.76%
EUR/DKK
0.17%
EUR/HRK
0.05%
EUR/CZK
0.02%
EUR/BAM
0.00%
EUR/RSD
-0.32%
EUR/GBP
-0.92%
EUR/ILS
-4.29%
-5.0% -4.0% -3.0% -2.0% -1.0% 0.0% 1.0% 2.0% 3.0%
Source: Yahoo Finance
14 15
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9th edition, July 2020 Property Index |
9th edition, July 2020
Norway #
4,120 EUR/ sq m
1.9%
Average Transaction Price of a New Dwelling Latvia
in Selected Countries (EUR/sqm), 2019 1,646 EUR/ sq m
-5.4%
Despite continuous convergence On the other hand, two other newly Denmark
of European economies and close included countries, Bulgaria and Bosnia and United Kingdom 3,124 EUR/ sq m
interconnections between them, Herzegovina, were countries with the lowest 3,861 EUR/ sq m 3,0%
the residential markets developing prices of new dwellings. Bulgaria recorded 2.3%
independently in each country. Among 550 EUR/sqm and Bosnia and Herzegovina
23 participating countries, four recorded 849 EUR/sqm of newly built apartment.
a price decrease and 19 showed growth in Netherlands**
prices of new dwellings. Slovakia, Ireland, Croatia, Latvia, Poland, 2,632 EUR/ sq m
Hungary, Serbia and Portugal are countries, 4.4%
Luxembourg, taking part in the survey for whose prices were in a range from Germany* Poland
Ireland
the first time, assumed the position of the 1,000 EUR/sqm to 2,000 EUR/sqm. Most 3,727 EUR/ sq m 1,520 EUR/ sq m
1600 EUR/sq m
most expensive country to buy a square of these countries are from central and 9.5% Czech Republic 9.7%
-1,2%
meter of a new apartment in 2019 with eastern Europe, which might indicate that 2,602 EUR/ sq m
7,145 EUR, more than 2,500 EUR ahead Europe can be divided into two parts based Belgium*
8.6%
of France with 4,523 EUR/sqm. Austria on dwelling prices. From this region, only 2,583 EUR/ sq m Luxembourg
and Norway recorded average prices prices in the Czech Republic were out of the 4.1% 7,145 EUR/ sq m
Slovakia*
over 4,000 EUR, with 4,176 EUR/sqm and above mentioned range with 2,602 EUR/sqm,
12.9%
Austria 1,770 EUR/ sq m
4,120 EUR/sqm. However, data for Norway especially due to high share of Prague on 11.0%
4,176 EUR/ sq m
are only available for detached houses, as the national average.
3.9%
no other transactional data were available. France
Five countries, Luxembourg, France, 4,523 EUR/ sq m Hungary
Another three countries, Israel, the United Spain, Hungary and Slovakia had growths 12.6% Croatia 1,475 EUR/ sq m
Kingdom and Germany, were in the range exceeding 10% in 2019. 1,664 EUR/ sq m 11.5%
between 3,700 – 3,900 EUR/sqm. 7.6%
Italy Serbia
2,314 EUR/ sq m 1,249 EUR/ sq m
0.1% -7.4%
Average Transaction Price of the New Dwelling (EUR/sq m), 2019
Annual Change (%) Bulgaria
Bosnia and 550 EUR/ sq m
< 1,000 2,501–3,000 Herzegovina 1.9%
849 EUR/ sq m
1,001–1,500 3,001–3,500
3.7%
1,501–2,000 3,501–4,000 Spain
2,398 EUR/ sq m
2,001–2,500 > 4,001 Portugal
12.4%
1,162 EUR/ sq m
6.3%
* bid price
** older dwellings
# detached house
Israel
Source: Deloitte national offices 3,882 EUR/ sq m
4.3%
16 17
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9th edition, July 2020 Property Index |
9th edition, July 2020
Average Transaction Price of a New Dwelling (EUR/sqm) and annual change
Vienna 3.4% 4,868 Lisbon 8.4% 3,908
PT
AT Graz 2.1% 3,539 Porto 20.1% 2,219
Linz 0.2% 3,992 Belgrade 2.4% 1,648
Brussels 0.0% 3,350 RS Novi Sad 8.4% 1,081
BE* Antwerp 3.8% 3,375 Niš 5.3% 790
Ghent 9.4% 3,475 Bratislava 13.0% 2,805
BA Sarajevo 13.7% 1,093 SK* Banská Bystrica 9.9% 1,843
Sofia -0.2% 1,088 Košice 2.2% 1,720
BG Varna 0.7% 837 Madrid 1.1% 4,394
Burgas 2.7% 863 ES* Barcelona 5.5% 5,763
HR Zagreb 0.7% 1,731 Alicante -9.3% 2,378
Prague 10.2% 3,395 London (inner) -0.2% 7,699
CZ Brno 10.0% 2,500 London (outer) 0.2% 5,732
UK
Ostrava 1.8% 1,683 Birmingham 0.7% 3,294
Copenhagen 2.5% 6,235 Manchester 4.9% 2,868
DN Aarhus -4.7% 4,395
Odense 5.1% 3,368 % Average transaction price of a new dwelling
Annual change
Paris -0.4% 12,863
Ile-de-France 3.3% 5,187 * bid price ** older dwellings # detached houses
FR Lyon 4.7% 4,467
Marseille 9.2% 4,521 Source: Deloitte national offices
Lille 4.5% 3,516
Berlin 10.0% 5,478
Hamburg 14.9% 5,745
DE
Münich 5.8% 8,250
Frankfurt
Budapest
13.2%
13.7% 2,107
6,960
Average Transaction Among central European cities, Prague was In terms of year-on-year changes, prices in
the most expensive in terms of purchasing Bergen in Norway grew the most between
HU Győr 14.5% 1,368 Price of a New Dwelling a new dwelling in 2019 with 3,395 EUR/sqm. 2018 and 2019, by 24.6%, followed by Porto
Debrecen 14.1% 1,266
in Selected Cities Bratislava places second by over 500 EUR with an increase of 20.1%. Another 15 cities
Dublin -1.8% 2,381 (2,805 EUR/sqm). recorded a double-digit growth last year.
IE Cork 0.9% 1,774
Paris was again the most expensive city
Galway 0.0% 1,853
in our publication in terms of transaction Niš from Serbia and Varna and Burgas from On the other hand, prices decreased
Tel Aviv 9.4% 9,769
prices of new dwellings in 2019 with Bulgaria were the only three cities with in eleven cities in the comparison. The
IL Jerusalem 16.7% 6,212
12,863 EUR/sqm. There was a slight price levels below 1,000 EUR/sqm. A square deepest falls could be seen in Alicante
Haifa 5.0% 3,832
decrease by 0.4% in comparison to 2018. meter of a new dwelling in Niš cost only (-9.3%) and Oslo (-9.0%).
Milan 2.5% 3,729 790 EUR and was the cheapest among the
IT Rome -1.8% 3,259
No other participating city had prices examined cities in 2019. Varna and Burgas The average price across all the examined
Turin -0.3% 1,947
over 10 000 EUR/sqm, but Tel Aviv recorded 837 EUR/sqm and 863 EUR/sqm cities was 3,758 EUR/sqm. From 67 cities,
Riga -3.1% 1,690
and Luxembourg City came close with respectively. 26 had above average price level and 41
LV
Jurmala -3.5% 2,265
9,769 EUR/sqm and 9,565 EUR/sqm were below the average. Milan and Haifa
Luxembourg City 8.1% 9,565
respectively. Six cities, Ghent in Belgium, Münich in were the closes to the average price with
LU Esch-sur-Alzette 15.3% 6,881 Germany, Tel Aviv in Israel, Milan in Italy, a deviation of 35 EUR/sqm and 68 EUR/sqm
Differdange 12.6% 5,766 Only two more cities, Münich (8,250 EUR/sqm) Jurmala in Latvia and Barcelona in Spain respectively.
Amsterdam 3.5% 5,315 and London (7,699 EUR/sqm), overcame were the most expensive cities in their
NL** Rotterdam 8.4% 2,748 the 7,000 EUR/sqm threshold. Relatively respective countries, despite the fact that
The Hague 7.3% 2,954 large differences in prices in the most they are not capital cities.
Oslo -9.0% 6,304 expensive cities in the publication might
NR# Bergen 24.6% 5,615 indicate that these cities are the most
Trondheim 8.7% 5,033 attractive on their home markets and in
Warsaw 8.4% 2,115 Europe as a whole and they attract people
Wroclaw 10.0% 1,731 from all around the world, which pushes
PL
Lodz 9.0% 1,360 housing prices higher.
Krakow 11.5% 1,813
18 19Property Index |
9th edition, July 2020 Property Index |
9th edition, July 2020
Comparison of the Main Cities to the Country Average (country average = 100%), 2019
Vienna 117% Lisbon 336%
PT
AT Graz 85% Porto 191%
Linz 96% Belgrade 132%
Brussels 130% RS Novi Sad 87%
BE* Antwerp 131% Niš 63%
Ghent 135% Bratislava 158%
BA Sarajevo 129% SK* Banská Bystrica 104%
Sofia 198% Košice 97%
BG Varna 152% Madrid 183%
Burgas 157% ES* Barcelona 240%
HR Zagreb 104% Alicante 99%
Prague 130% London (inner) 199%
CZ Brno 96% London (outer) 148%
UK
Ostrava 65% Birmingham 85%
Copenhagen 200% Manchester 74%
DN Aarhus 141%
Odense 108%
< 100% > 100%
Paris 284%
Ile-de-France 115% * bid price ** older dwellings # detached houses
FR Lyon 99%
Marseille 100%
Source: Deloitte national offices
Lille 78%
Berlin 147%
Hamburg 154%
DE
Münich 221%
Frankfurt 187%
The proportion of prices in selected cities Moreover, price levels in Manchester, Lille,
Budapest 143%
and in their respective countries serves Differdange, Turin, Graz, Birmingham,
HU Győr 93%
as an indicator of how demanding it might Debrecen, Novi Sad and Lodz were all
Debrecen 86%
be for citizens of each country to relocate lower by 10% - 30% than the national
Dublin 149%
into one of the main cities if they want to average. This might indicate that despite
IE Cork 111%
acquire their own dwelling there. the fact that they are important for their
Galway 116%
countries’ economies, they are not the
Tel Aviv 252%
The highest disproportion in 2019 could be most attractive places to live.
IL Jerusalem 160%
observed in Portugal, where price levels in
Haifa 99%
Lisbon were 336% of the national average. In terms of price equality in each
Milan 161%
It was the only city in the publication to participating country, Austria and
IT Rome 141%
be over three times as expensive as the Luxemburg displayed the lowest average
Turin 84%
national average. deviations from national average with
Riga 103%
LV 12% and 19%. Further, Latvia, Poland,
Jurmala 138%
An average price per square meter of a Hungary, Slovakia, the Czech Republic,
Luxembourg City 134%
new dwelling cost more than two times the Ireland, Serbia, Bosnia and Herzegovina
LU Esch-sur-Alzette 96%
national average in Paris (284%), Tel Aviv and Belgium had all an average deviation
Differdange 81%
(252%), Barcelona (240%), Münich (221%), between 20% and 30%.
Amsterdam 202%
Amsterdam (202%) and Copenhagen
NL** Rotterdam 104%
(200%). The highest average deviation was
The Hague 112%
reported in Portugal, where Lisbon and
Oslo 153%
Ostrava in the Czech Republic and Niš in Porto were by 164% more expensive than
NO# Bergen 136%
Serbia are the two cities with the lowest the national average. Portugal was the
Trondheim 122%
ratio to their respective national averages only country to exceed the 100% mark,
Warsaw 139%
with 65% and 63% respectively. Germany on the second place had an
Wroclaw 114%
PL average deviation of 77%.
Lodz 89%
Krakow 119%
20 21Property Index |
9th edition, July 2020 Property Index |
9th edition, July 2020
Average Transaction Price of New Dwellings in Capital Cities, annual change
Oslo#
-9.0% Capital cities are usually the most A continued upward development of
important and the biggest markets in prices was apparent in central European
Riga
individual countries. For better illustration countries, among which Budapest
-3.1%
of transaction price development across recorded the highest growth (13.7%),
Rome Europe, we analysed the annual price followed by Bratislava (13.0%), Prague
-1.8% changes in them. (10.2%) and prices in Warsaw grew by 8.4%,
Dublin which is still a strong increase.
-1.8% In comparison with annual changes
Paris between 2017 and 2018, an overall Prices grew the fastest in Jerusalem, the
-0.4% slowdown was apparent across the capital of Israel, where a square meter of
selected markets. Last year, two countries a new apartment in 2019 was 16.7% more
Sofia
had a price increase of over 20% and expensive than a year before.
-0.2%
only Rome recorded a decrease, in the
London (inner) current edition, only one city had a growth
-0.2% over 15% and seven cities saw a price
Brussels* correction. In 2019, an overall slowdown across
0.0%
Zagreb The biggest price fall between 2018
and 2019 was in Oslo, where prices of
participating countries was apparent
0.7%
Madrid*
detached houses decreased by 9.0%. New
apartments in Latvian capital Riga were
in comparison with 2018.
1.1%
3.1% cheaper than a year before and 1.8%
Belgrade decreased was recorded in both Rome and
2.4% Dublin. For Rome, it was a second year in
Copenhagen a row with a price decrease.
2.5%
Vienna Paris and London, two of the most
3.4% important residential markets in Europe,
both saw a stagnation in new property
Amsterdam**
prices, with price changes of -0.4% and
3.5%
-0.2% respectively.
Luxembourg City
8.1%
Warsaw
8.4%
Lisbon
8.4%
Berlin
10.0%
Prague
10.2%
Bratislava*
13.0%
Budapest
13.7%
Sarajevo Annual change
13.7%
Jerusalem * bid price
16.7% ** older dwellings
# detached houses
-15.0% -10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% Source: Deloitte national offices
22 23100
Property Index |
9th edition, July 2020 Property Index |
9th edition, July 2020
0
14
Affordability of Own Housing
Multiple of annual gross salaries to purchase a 70 sqm dwelling
12
11.4 11.3
10.0 9.9
10
8.9
8.7
8.2
7.7 7.6
8
6.8
6.5
6.2
6 5.6
5.4
5.0 5.0
4.1
4.0
4
2
0
CZ RS AT SK* LV IL HR PL HU BA UK IT NL** DE* BG NO# BE* PT
* bid price
** older dwellings
# detached houses
Source: Deloitte national offices
200%
Affordability of Own the participating countries, being by only and 4.1 multiples of yearly earnings needed
one tenth of a year more affordable than to purchase a dwelling in 2019 respectively.
Housing the Czech Republic. Even though housing However, the difference between gross and
160% prices in Serbia were one of the lowest, the net salary in Belgium is bigger than in most
To assess the affordability of own housing difference between them and the average of other countries, which may distort the
in participating countries, we calculated the salary were higher than in most of the other results.
number of average gross annual salaries selected countries.
needed to purchase a standardised new
120% Generally, prices of dwellings in most
dwelling in each country. We assume an Potential buyers in Austria and Slovakia countries grew faster than average salaries
average apartment with area of 70 square had to spend around ten times the average in 2019, which translated into lower
meters. annual salary to purchase a 70 square meter affordability of housing. The change was
80%
dwelling. between 0.2 and 0.4 years in most of the
Similarly as in the previous edition, the least participating countries.
affordable own housing was in the Czech A relatively affordable own housing can be
Republic, which occupied this position for found in Norway, Bulgaria, Germany and the Dwelling stocks across European countries
40%
the fourth time in a row. Buyers in the Czech Netherlands, where a standardised dwelling differ in size and structure. Our indicator
Republic needed 11.4 average annual salaries can be purchased for a price between 5 and tries to provide a way to compare
to purchase a standardised dwelling. 6 times the average annual salary. affordability across participating countries.
0% However, the chosen 70 sqm dwelling does
Serbia, a new entrant to the publication, had The best affordability rates were, as in the not reflect the structure of apartments in
the second least affordable housing among last year, in Portugal and Belgium, with 4.0 every country properly.
24 25Property Index |
9th edition, July 2020 Property Index |
9th edition, July 2020
Rental market Luxembourg was the most expensive prices that resulted in a rent freeze starting Prague (12.31 EUR/sqm) placed second Austria (AT); Italy (IT);
country to rent an apartment in 2019, from February 2020. However, the average before Budapest (11.59 EUR/sqm) and Belgium (BE); Latvia (LV);
The position of rental housing is becoming as all three cities, Luxembourg City rental price was 9.10 EUR/sqm, which is Bratislava (11.02 EUR/sqm).
stronger, especially in capitals and other (30.71 EUR/sqm), Esch-sur-Alzette comparable to regional cities in Central Bosnia and Herzegovina (BA); Luxembourg (LU);
main cities across participating countries. (21.80 EUR/sqm) and Differdange Europe, such as Brno (9.62 EUR/sqm), Newly provided data from Balkan Bulgaria (BG); Netherlands (NL);
We believe that rental housing forms a vital (19.96 EUR/sqm), placed among the ten Košice (9.45 EUR/sqm) or Lodz countries (Bosnia and Herzegovina,
part of the residential market and therefore most expensive cities. (9.26 EUR/sqm). Bulgaria, Croatia and Serbia) show, that Croatia (HR); Norway (NO);
we would like to keep providing the general this part of Europe is comparatively Czech Republic (CZ); Poland (PL);
market with relevant information about In total, five cities recorded an average Besides Berlin, Vienna is another capital city the most affordable in terms of rental
Denmark (DK); Portugal (PT);
rental markets across Europe. rent per sqm of at least 25 EUR in 2019. with comparatively low rents, 9.90 EUR/sqm, housing. Sarajevo, capital of Bosnia and
Luxembourg City was followed by Paris and relatively high property prices. Herzegovina, and Sofia, the Bulgarian France (FR); Serbia (RS);
After two years at the position of the most (28.30 EUR/sqm), inner London capital, are on the last two places of our
Germany (DE); Slovakia (SK);
expensive city in our selection, Paris had (27.02 EUR/sqm), Oslo (25.80 EUR/sqm) Among central European countries, list with 4.08 EUR/sqm and 4.10 EUR/sqm
lost its position to Luxembourg City with and Dublin (25.00 EUR/sqm). the Polish capital Warsaw recorded the respectively. Hungary (HU); Spain (ES); and
30.71 EUR/sqm rent. It is the only city highest average rents per sqm in 2019 with
Ireland (IE); United Kingdom (UK).
with average rent over 30 EUR/sqm in the Berlin, the capital of Germany, had 16.65 EUR, which is even higher than the
publication. witnessed protests against rising rental average rent in Münich (16.40 EUR/sqm). Israel (IL);
Source: Deloitte national offices
Average Monthly Rent (EUR/sqm)
35
30.7
30
28.3
27.0
25.8
25.0
25
21.8
21.1 20.7
20.0 19.9
20 19.3 19.2
18.9 18.6
18.4 18.1
17.3
16.7 16.4 16.4
16.3
15 14.3
13.7 13.4
13.3 13.0 12.9
12.8 12.5
12.3 12.0
11.8 11.8 11.7 11.6 11.5 11.5
11.1 11.0 11.0
10.5
9.9 9.7 9.6 9.6
10 9.5 9.5 9.3 9.1 9.1 8.7 8.6 8.6
8.0
7.0 7.0 6.9 6.7 6.4
6.0
5.0
5 4.1 4.1
0
Luxembourg City
London (inner)
Esch-sur-Alzette
Paris
Oslo
Dublin
Trondheim
Amsterdam
Differdange
Copenhagen
Barcelona
Bergen
Ile-de-France
Madrid
London (outer)
Tel Aviv
Cork
Warsaw
Galway
Münich
Aarhus
Lisbon
Brussels
Frankfurt
Budapest
Krakow
Antwerp
Jerusalem
Lille
Odense
Rome
Rotterdam
Lyon
The Hague
Milan
Prague
Marseille
Wroclaw
Bratislava
Manchester
Hamburg
Vienna
Ghent
Brno
Birmingham
Haifa
Košice
Lodz
Linz
Berlin
Banská Bystrica
Porto
Alicante
Graz
Debrecen
Belgrade
Turin
Győr
Ostrava
Novi Sad
Niš
Sofia
Sarajevo
26 27Property Index |
9th edition, July 2020 Property Index |
9th edition, July 2020
Average bid price of Average transaction Average bid price of Average transaction
new dwellings – sqm price of new older dwellings – sqm price of older
dwellings – sqm dwellings – sqm
Austria NA 4,176 NA 2,930
Belgium 2,632 NA NA 1,950
Bosnia and Herzegovina NA 849 NA NA
Bulgaria NA 550 NA NA
Croatia NA 1,664 NA NA
Czech Republic 3,364 2,602 1,872 1,534
Denmark 3,280 3,124 2,645 2,519
France NA 4,523 3,427 3,414
Germany 3,727 NA 2,641 NA
Hungary 1,549 1,475 849 808
Ireland NA 1,694 NA 1,694
Israel NA 3,882 NA 4,533
Italy 2,677 2,314 2,140 1,850
Latvia NA 1,646 NA 562
Luxembourg 8,643 7,145 6,596 6,057
Netherlands NA NA 2,857 2,632
Norway# NA 4,120 NA 4,374
Poland 1,602 1,520 1,539 1,348
Portugal NA 1,162 NA 1,023
Serbia 1,388 1,249 1,320 1,188
Slovakia NA NA 1,770 NA
Spain 2,860 2,398 1,653 1,531
United Kingdom NA 3,861 NA 3,057
# detached houses
Source: Deloitte national offices
28 292
2
Property Index |
9th edition, July 2020 Property Index |
9th edition, July 2020
0
0
Mortgage
Total Outstanding Residential Loans to Disposable Income of Households Ratio (%), 2018
200%
187.6%
200% 167.2%
Markets in Europe
159.9%
160%
144.8%
160%
120%
97.7% 95.6%
120%
The mortgage market is a vital part of 2019 was another strong year in terms
76.0%
the residential property market in each of economic growth, which allowed 80%
68.5% 68.5% 68.5% 66.9%
country. One of the most important some of the central banks, especially
indicator on the residential market is in countries outside the Eurozone, to 80% 50.1% 48.0%
the indebtedness of households, i.e. the increase their benchmark interest rates. 40.2%
40% 34.6% 32.2%
proportion of the outstanding volume of This consequently creates a pressure on 23.2%
all mortgage loans issues to households the mortgage interest rates. However, 18.1%
15.1%
40%
to households’ disposable income. the European Central Bank kept its
Consequently, the ability of households interest rates on the virtual zero, which 0%
to take on new debt is one of the was introduced in 2016. This allowed
determinants of house price growth. some commercial banks in the Eurozone NL DK NO LU UK BE IE FR DE PT ES AT SK CZ PL IT LT HU BG
0%
countries to push the interest rates on
The residential debt to households’ mortgages to record minimums in an Source: Hypostat 2019
disposable income ratio in Bulgaria and attempt to acquire new clients.
Hungary, where the level is below 20%.
Average mortgage interest rates in
Countries with a low level of mortgage Portugal, France and Slovakia were below
indebtedness proportion (under 50%) 1.5% and even being close to the 1% mark Average
5% Mortgage Rate (%), 2019
are mainly located in Central and Eastern in case of Portugal (1.06%).
Europe, with exception of Italy. These 5%
countries are Latvia, Poland, the Czech The average mortgage interest rates 4.6%
Republic and Slovakia. increased only in five analyzed countries 4%
(the Czech Republic, Hungary, Latvia, 4.1%
Four countries have an indebtedness ratio Norway and Portugal), with the majority of 4% 3.8%
of over 100%. The countries are Luxemburg them not being part of the Eurozone.
3%
(145%), Norway (160%), Denmark (167%)
and the Netherlands with the highest ratio Hungary, Ireland and Poland are the only 3.0% 3.0%
2.9% 2.9%
3% 2.8%
recorded at 188%. countries in our publication to have average 2.7%
mortgage rates above 3%. Mortgages in 2% 2.3%
In most of the analysed countries, the Poland cost 3.8% on interest annually, 4.1% 2.2%
residential loans to disposable income in Ireland and 4.6% in Hungary. 1.8%
1.9%
2% 1.7% 1.7%
of households ratio decreases between 1.6% 1.6% 1.6%
2017 and 2018. This might indicate that the Among five countries with the highest 1% 1.4%
1.2%
disposable income of households is rising average mortgage rates, four (Hungary, 1.1%
faster than the value of debt they are willing Poland, Israel and Croatia) are using their 1%
to take or that households are becoming local currencies. This may be the cause of
more conservative when deciding on higher rates because commercial banks 0%
acquiring properties. source most of their funds in Euros or US
dollars. 0%
PT FR SK BE DE AT IT DK LU UK ES NL CZ NO BG LT HR IL PL IE HU
Source: Deloitte national offices
30 31Property Index |
9th edition, July 2020 Property Index |
9th edition, July 2020
Annex:
Austria
In 2019, the land register recorded continues to exceed the supply despite meter, and the property may not be sold
Comments
approximately 49,832 sold apartments. somewhat slower population growth. for a period of 40 years. Moreover, the
The transaction value of the The increase in purchase prices can change of the zoning provisions resulted
residential properties sold amounted furthermore be attributed to the interest in an increased number of subsidized
to approximately 12 bn. EUR, which rate level and rising construction costs. constructions of residential properties,
represents an increase of 6.5% over the so that the number of subsidized rental
on Residential
previous year. Vienna accounted for 29% In Vienna, a change in the zoning apartments exceeded freely financed
of all apartment sales with a value share provisions under the building Code led rental apartments.
of approx. 35%. to lasting uncertainty among developers.
In the case of rezoning of "rural" land The possibilities of compensating
Especially in Vienna, also the amount of into land zoned for residential buildings, rising square meter prices and rents
Markets
newly constructed residential buildings two-thirds of the resulting living space by reducing the size of the apartments
exceeded the values of the previous must be publicly subsidized (or at least appear to have been exhausted.
years. The upward trend in purchase eligible for subsidy) if the target living However, as long as prices remain high,
prices and rents on the Austrian space exceeds 5,000 square meters. This there will not be a trend shift towards
residential property market continued has a substantial effect on profitability, larger apartments.
in 2019. In particular, in urban areas, as the net rent for subsidized properties
the demand for additional living space may not exceed five euros per square
Belgium
Although the increasing risk of various granted increased by approximately 24% autumn holidays, compared to the same
factors in the residential property market compared to 2018. However, the number period last year. However, the expected
such as tax implications, rising interest of building permits fell by approximately decline in property prices due to the
rates and political and/or environmental 10% in 2019, partly because the increase scrapping of the ‘housing bonus’ will be
changes, 2018 was followed by another in the number of dwellings in recent years minimal compared to the consequences of
record-breaking year. 2019 became the was considerably higher than population the current health crisis. Furthermore, the
year in which the Belgian citizens were growth. so called ‘concrete stop’ (putting a halt on
the most active ever. The number of consuming unconstructed spaces) that was
transactions rose by an impressive 9% The remarkable increase in the number of discussed in 2018 was suspended in 2019
(including both houses and apartments). transactions is due to several aspects. On and transformed into a vague ‘concrete
Also, the residential real estate prices the one hand, the sustainability standards shift’, with no or limited expected impact in
recorded a notable increase of 4%, with the for rental homes became much stricter. the medium term.
most pronounced increase in the sector As a result, the necessary adaptations,
of normal houses. Rents followed a similar particularly in older apartments in the In addition to these causes, the low interest
trend, with especially a substantial increase lower segment, became a capital-intensive rates, confirmed by the ECB to remain
in the Brussels Capital Region of more than matter. This resulted in owners selling this low in the upcoming years, ensured
6%. These increases are all significantly their properties rather than renovating that the property market remained
higher than the inflation of around +1.4%, them. On the other hand, it was mainly an interesting and stable investment
which is no surprise. It was also a record the suppression of the ‘housing bonus’ landscape. Unemployment rates continued
year for the number of mortgage loans. (the tax advantage of owning a house) end to fall compared to 2018 and the possible
Even though, the BNB/NBB restricted the of 2019 in Flanders that had the greatest increase in tax rates on home ownership
leverage ratio for investment real estate impact on the number of transactions. In also failed to materialize. From a political
to 80% and imposed more regulations on the last quarter of 2019, the number of perspective, this will most likely not change
granting mortgage loans, with €46.2 billion transactions increased by 25%, with even in the short term now the government is
(including refinancing), the amount a temporary peak of 122% during the concerned with the current health crisis.
32 33Property Index |
9th edition, July 2020 Property Index |
9th edition, July 2020
Bosnia and Herzegovina
from 10,619 EUR in 2015 to 13,270 EUR growth was recorded. In addition, was the Government housing subsidy
in 2019. In the same period, average revenue generated from tourism has program. According to the program, the
net salary in Croatia increased from increased by 6.4% in 2018 (total 10 bn. government provides subsidy amounting
750 EUR in 2015 to 868 EUR in 2019 EUR recorded in 2018), while in 2019 to 30% to 50% of the monthly mortgage
Residential market gained additional mortgage loans, fewer initiated new (+15.6%). 8% growth is expected according to amount for people under 40 who are
momentum in 2019, continuing to follow residential projects, and favorable preliminary data. Positive tourism purchasing their first home. The subsidy
the strong growth curve from 2018. economic conditions in European 2. Interest rates for newly granted loans
trends had significant impact on the RE is provided for 4 years and is extended
The main factors behind the positive countries, where the most of the BiH continued to fall in 2019 and shifted
market, being one of the price increase by 2 years for each child born during the
development have been lower interest diaspora work and live. Prices rose in towards 3% during mid-2019. This is
drivers. However, this effect is not period. This program is effective since
rates on saving accounts and personal average by 5–10% compared to 2018. in line with the general interest rates'
equally spread throughout the country 2017 and becomes available once or
trends in the EU and globally and was
as coastal area and Zagreb city are the twice per year for a one-month duration
one of the RE price increase drivers.
main beneficiaries of these trends. according to the government’s decision
3. During the last few years, Croatia has (usually September and March). Ever
Bulgaria
recorded a strong tourism growth, Market specifics: since it was introduced, this program has
with continued increase in arrivals Apart from the generally positive brought disruptions to the residential
and overnight stays. In 2018, total economic situation in Croatia in the last market, as prices tend to rise for the
arrivals were 7.1% higher compared few years, one of the important drivers period when the subsidy gets announced
The nationwide house price index rose The almost zero interest rates on bank while existing dwelling prices increased to 2017, while in 2019, further 4.8% of the residential property price increase and effective.
by 7.3% (3.6% inflation-adjusted) during deposits have encouraged people to by 5.5%.
the year to Q1 2019, following y-o-y rises invest in real estate, and encouraged
of 5.5% in Q4 2018, 6.3% in Q3, 7.5% in Q2 purchases of pre-construction residential In Burgas, overall house prices rose by 8%
and 7.1% in Q1, according to the National property. Sofia, Bulgaria’s capital, saw an during the year to Q1 2019. New dwelling
Statistical Institute (NSI). During the latest
quarter, house prices increased 2.6%
overall house price increase of 9.5% y-o-y
in Q1 2019. Prices for new dwellings rose
prices rose by 9.6% while existing
dwelling prices increased by 5.6%.
Czech Republic
(1.4% inflation-adjusted) in Q1 2019. strongly by 18.6% while existing dwellings
saw a price increase of 5.3%. In Ruse, overall house prices rose by The year 2019 on the Czech residential entire Czech Republic, sales prices of 2020 was expected to be similar to
Prices of new dwellings rose by 11.9% 3.3% in Q1 2019 from a year earlier. New market was marked by a continuing rise apartments in development increased 2019, in terms of both development of
(8% inflation-adjusted) during the year In Plovdiv, the second largest city in dwelling prices increased by 4.6% while in apartment prices. Although the cooling by 15.4%. Rising prices of apartments in apartment prices and the number of
to Q1 2019, sharply up from the previous Bulgaria, we saw house price rise by 7.1% existing dwelling prices rose by 3.1%. in the number of realized transactions Prague and Brno and their immediate transactions. However, this was only valid
year’s 2.3% y-o-y rise. During the latest during the year to Q1 2019. Prices of was noticeable, especially in connection vicinity are the main driving force of until March. In the week starting on 16th
quarter, prices of new dwellings increased new dwellings increased by 12.6% while In Stara Zagora, overall house prices with the applied regulatory measures the growth. In new development, the March 2020, many things have changed.
by 5.7% (4.4% inflation-adjusted). Prices existing dwelling prices rose by 3.9%. increased by 4.4% y-o-y in Q1 2019. concerning housing financing, the increase has been slower, average The real estate world has stopped day by
of existing dwellings rose by 5% (1.3% New dwelling prices surged by 9% while expected and often mentioned price transaction price grew by 8.6%. day as fast as the coronavirus pandemic
inflation-adjusted) in Q1 2019 from a year Varna, the largest city and seaside resort existing dwelling prices rose by 2.9% corrections did not occur. There was started. Along with the development
earlier, lower than the 9.7% y-o-y growth on the Black Sea Coast, recorded an no reason for them, as the demand for Throughout 2019, the mortgage market market, the supply and sales part of the
in Q1 2018. Quarter-on-quarter, existing overall house price rise of 4.1% during the owner-occupied housing, especially in was adjusting to the stricter CNB second-hand real estate market gradually
house prices increased by 1.1% (-0.1% year to Q1 2019. Over the same period, large Czech cities, remained strong. Only regulation and recorded the worst hibernated. Further development of the
inflation-adjusted). prices of new dwellings rose by 1.5% the growth dynamics has adjusted, hence results in five years. Compared to 2018, residential real estate market will depend
housing prices have not risen as sharply the total number of provided mortgage mainly on how long the economy will be
as in the previous three years. loans decreased by more than 22% to artificially subdued and at the same time,
77,388 contracts. Rising real estate prices what proposals of administrative changes
Croatia
Transaction prices grew year-on-year prevented volumes from falling as much the government will introduce.
in almost all regional cities in the Czech as the number of contracts, yet the total
Republic. From the perspective of volume of provided mortgages fell by
individual market segments, transaction 16.9% to 181.6 bn. CZK. The volume-
During 2019, residential property prices in country’s average. In 2018, average price have increased by 30.9%, from 11,586 prices of apartments rose the most bound average interest rate increased to
Croatia continued to follow an increasing per sqm for new dwellings in Zagreb was in 2018 to 15,162 in 2019. This supply in older buildings. At the level of the 2.68%.
trend as new dwellings recorded a 7.6% 11.2% higher than the country average, increase could have implications to the RE
price increase compared to 2018 on which decreased to 4.0% in 2019. price movement in 2020 if demand levels
a country level (from 1,547 EUR to start to shrink.
1,664 EUR). Residential property market Apart from the continued RE price
in Croatia has been centered around increase trend in 2019, the increasing Price growth drivers:
the country’s capital (Zagreb) and supply trend has also been clear as newly
1. Croatia recorded a continued GDP
the coast, with prices in these areas started dwellings (expressed as the
growth around 3% yearly since 2015,
showing significant deviation from the number of newly issued building permits)
while GDP per capita has increased
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