Brussels indicates that property prices may rise soon and points to a recovery in demand at a later stage.
Source: Freepik
Author: Redaction
The European Commission (EC) has launched forecasts for the real estate market, indicating, soon, a possible rise in prices in the European Union (EU). This projection is made in a context where there is a lack of housing in the average of the Member States and with the spring economic forecasts marking the moderation of real estate markets last year.
Thus, despite regional variations, Brussels notes that "real estate prices will soon rise again", recalling that in the fourth quarter of last year, prices in the euro area stood at 1.2% below the 2022 level. EU prices, on the other hand, were 0.2% higher, and variations averaged -1.1% in the Eurozone and -0.3% in the EU.
On the countries most affected by the variations, they point out: "the most significant decreases were registered in Germany, Sweden, Luxembourg and Finland. On the contrary, Croatia, Bulgaria, Lithuania, Poland, Portugal and Slovenia recorded growth rates above 6%".
Regarding new building permits and transactions in this area, the Community executive indicates that the figures were close to the lowest levels in the last ten years: "construction permits seem to have recently begun to recover. Strict credit standards and low demand are expected to continue to weigh on real estate transactions and construction for a few more quarters", they indicate.
In this context, the EC points out that, at a later stage, there may be a recovery in demand, in favour of the outlook for income growth and the reduction in interest rates indicated by the European Central Bank: "the interaction between these developments and structurally low housing supply is expected to support housing prices in the future".
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