European residential On the rise - EMEA June 2021 - Colliers International
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
EMEA European residential On the rise June 2021
Key trends Figure 2:
Average age of first time buyers by country, Europe
Figure 3:
Sqm affordability by city, based on income and financing
Appetite for residential as activity expands, and deepens rising rents and reduced affordability. Switzerland 48 Warsaw
Marseille
across European countries and cities. Vonovia has been quoted in the Czechia Krakow
assets on the rise press (FT, May 25 2021) stating they
42 Rotterdam
The Hague
Spain 41 Dusseldorf
The residential sector has seen the Capital diversification, are prepared to limit rent increases
Denmark 35
Cologne
Rome
in order to win political support for
biggest rise in investment volumes and consolidation Germany 34
Stuttgart
Utrecht
the all-cash merger. Clearly this is Madrid
of any real estate asset class in Ireland 34 Milan
While the raft of new capital looking coming swiftly after the decision Aarhus
Europe over the last investment cycle, UK 34 Birmingham
to invest in the residential sector by the German constitutional court Bordeaux
accounting for 22% of investment Hamburg
points to greater diversity, this comes to rule that Berlin’s Mietendeckel Italy 33 Berlin
activity in 2020, up from a mere 8% Lyon
on the back of more consolidation of ‘rent cap’ regulation is unlawful. Austria 31 Barcelona
in 2009. Its defensive qualities led Copenhagen
assets under management among Alongside a willingness to limit rent France 31 Frankfurt
investors to increase spending in Vienna
the biggest residential landlords in increases significantly until 2026, the Netherlands 30 Manchester
the sector during 2020, to some 18% Munich
Europe. The likes of Blackstone, AXA two companies have said they will Finland 29 Amsterdam
above the five-year average. London
REIM, Union Investment, Greystar sell 20,000 flats to Berlin’s regional Belgium 27 Paris
In terms of fresh capital, there is over and Roundhill Capital have been busy government and build another Iceland 27 0 5 10 15 20 25 30 35 40 45 50 55 60
€60 billion in funds being raised with building their portfolios. Swedish 13,000 in the German capital to Sqm
Source: OECD Source: Colliers
a focus on the sector – matching investor Heimstaden has been combat the lack of housing supply
the amount invested in 2020 – as actively growing its presence across and sharply rising rents – two issues
in terms of the amount of floor It is therefore no surprise that the
investors consider a range of asset Europe over the last few years, and that have become a contentious Low affordability and
types and routes to market, including now sits firmly in second place at the topic in the run-up to federal and space one can buy based on average private rental sector in Poland has
local elections in September in Berlin,
tight supply create an income levels. Buyers can almost been limited to approximately 10%
the build-to-rent, build-to-sell, top of the ‘net investor’ charts with a
private rented, co-living, senior and reported €13.8 billion of assets under and across Germany. The deal is investor’s market double the amount of space they of housing stock.
student housing residential niches. management. The recently proposed also being accelerated in order to can afford in the likes of Dusseldorf,
One of the key drivers of demand Cologne, or Marseille relative to these All of these factors and more,
Additionally, the growth in impact merger of Vonovia and Deutsche negate the €1bn plus in stamp duty
in the private rented sector is the cities. In Warsaw based on average are considered in detail in this
and social investing is driving capital Wohnen will create a €20 billion+ Vonovia will need to pay on Deutsche
‘unaffordability’ of home ownership, household incomes you could buy report alongside a summary of
to engage in the development and asset-rich investor that will be one of Wohnen’s property portfolio once
and the fact many households three times as much residential residential market dynamics in
acquisition of assets in the social the most powerful players in Berlin’s changes to tax laws come into play
do not qualify for socially rented floorspace as in Paris. several European cities. This report
rented housing sphere. Equally, the property market, Germany’s biggest in July. Elsewhere, notably in the UK,
accommodation. Government depicts how each factor can vary
ubiquitous nature of the residential listed residential landlord and Europe’s the impact of government policy to
policy across Europe has typically Affordability is not just a function significantly and thus how the
sector and the broad range of largest private residential landlord. minimise stamp duty obligations of
been to support home ownership, of demand, but also supply, and overall constitution of each city
opportunities it offers will lead to buyers over the past 12 months has
While the size of the deal is making reducing the demands on the state housing tenure differs markedly differs markedly from an investment
a rise in market share of the ‘beds’ helped support the owner-occupier
the headlines, what lies beneath is to provide housing yet stimulating across European cities as a result perspective. The key takeaway is
sector relative to other commercial market, stimulating house price
highly indicative of the main factors house price rises and driving a of many years of changing policy that despite significant differences
real estate types, reaching 30% of growth and putting further pressure
shaping the broader residential bigger affordability gap. This means and cultural differences. Germany between the fundamentals that
investment volumes in this new cycle on affordability.
market in Europe – a lack of supply, that the average age of ownership has a mature private rental housing drive the housing market – such as
is firmly in the mid-30s on average market, which is in stark contrast to the size and expansion of target
Figure 1: most other European cities. Some population groups, affordability
across Europe, ranging from
Top 20 Residential ‘net’ investors, Europe: 2008 to Q1 2021 around 30 years of age in Finland 60% of the housing stock of the levels, housing stock and tenure,
and the Netherlands to 48 years of largest ‘German 7’ cities is comprised investor liquidity, and historic and
25
EUR bn
age in Switzerland. In the biggest of private rented accommodation, future inflation and rental growth –
20 investment markets of the UK and compared to a European average the unique composition of each city
15 Germany the average is 34 years of around 30%. The reason for this creates an opportunity for various
10 of age, and the affordability gap is pronounced division is partly due to forms of residential investment and
widening. the established nature of the private development going forwards. The
5
rented sector and the strict income challenge is developing a strategy
0 When house prices are viewed standards applied when qualifying and operating model that plays
against income levels and the relative
Aberdeen Standard
Caisse des Depots
LEG Immobilien
Credit Suisse
Aberdeen Standard Invest
Swiss Life AM
Peach Property Group
Universal-Investment
Deutsche Wohnen SE
Vonovia SE
Heimstaden
Blackstone
AXA Group
Union Investment
ADO Properties
DWS Group
ZBI
Cerberus
BVK
Patrizia
Catella
for a social rental home. In contrast, to a city’s strengths, in addition to
costs of financing in each country the the accessibility of social rental those of the investor. Efforts to
major affordability gaps in markets housing in Poland is quite high. This strike the right balance are helping
are particularly apparent. Paris, not only results in a very large social to drive the diversity of capital,
London, Amsterdam, Munich and housing market, contributing to 23% and spread residential investment
Manchester rank as the five most of housing stock in Warsaw, but also and development, across multiple
Source: Colliers, Real Capital Analytics expensive cities to purchase a home, limits interest in the private sector. European city locations.
02 | European residential on the rise | EMEA Research & Forecast Report European residential on the rise | EMEA Research & Forecast Report | 03
City attractiveness index: residential investment focus Figure 4:
Residential attractiveness scores
If we measure each city against a combination of factors we can assess the relative attractiveness of cities as
investment locations. 75
Scenario 2: Development potential
Table 1: City ranking factors Madrid
70 Rome
Vienna
Copenhagen
Demand drivers 65
Warsaw London
Investment Drivers
Quality of Life Index Amsterdam Paris
60
Inflation forecast (3yr)
Households
Rental price evolution (last 4yr)
Household growth forecast (10yr) 55 Munich
Rent regulation
Target population
Private rented sector (% of stock) 50
Target population growth forecast (10yr)
Berlin
Yield
House price to income affordability
45
Yield evolution (last 4yr)
Rent to income affordability
Vacant possession value evolution 40
Household income per capita
Investment volume 40 45 50 55 60 65 70 75
Household income growth forecast (3yr)
Scenario 1: Established markets
Source: Colliers
Taking into account these key factors, relative household income, formation and forecast changes over the next 10
years, we have assessed how each market compares, or scores, utilising our Cities of Influence methodology.
Scenario 1: Established markets Scenario 2: Development potential
Figure 5:
In scenario one, we are looking at factors to establish In Scenario 2 we are assessing markets slightly Residential attractiveness scores
how city catchments (not just central areas) score differently. While we’re still looking at the fundamental
for core investors looking at depth, stability and factors driving demand, we have adjusted the target
Scenario 1 Scenario 2
income drivers relative to historic and forecast pricing population group to account for those aged up to the 80
movements, returns and investment liquidity. average first time buyer age per country, rather than
using a standard 20-35yrs cohort. Additionally, we
In Scenario 1, the larger conurbations top the charts 70
examine the pricing and investment side differently - i.e.
– London, Paris and Madrid, with Copenhagen also where there is low liquidity, limited historic movement
performing strongly. (growth) in pricing and returns and thus the opportunity 60
to capture future growth.
50
In Scenario 2, Madrid, Rome, Copenhagen come out on
top, closely followed by London, Vienna and Warsaw. 40
Every city is highly idiosyncratic in terms of how the residential sector functions by sub-market. Certain sub-markets in each
city will under- or outperform the city average, and thus generate a different set of results. Equally, there are many other cities 30
that investors are considering for residential investment not covered in this sample index – from Krakow to Kiel, Helsinki to
Hamburg and Milan to Manchester. But the index does provide a benchmark as to where future investment activity may be 20
Copenhagen
focused going forwards, and insight into investor strategy, for the bigger European cities.
Amsterdam
10
Warsaw
London
Munich
Madrid
Vienna
Berlin
Rome
Paris
0
Source: Colliers
04 | European residential on the rise | EMEA Research & Forecast Report European residential on the rise | EMEA Research & Forecast Report | 05
Introduction: Capital in search of safety Living sector success is
based on fundamentals
Household growth,
limited building capacity
Supply-demand
dynamics a catalyst for
The fact that more money is being
in cities stoke shortages investment
In a year where the world came to a standstill and everything was uncertain, the housing
allocated to the European living sector Even though Europe as a whole Strong household growth and the
market has turned out to be the safe haven in which to invest. Over the past investment
has everything to do with the stable is faced with an aging population accompanying housing shortages
cycle, there has been a visible shift towards investment in the living sector, represented foundation of the housing market. and falling levels of household are magnets for investment activity.
by the sector’s growing market share of total investment volumes, from around 8% development, this is not the case As Figure 2 shows, there is a clear,
A house or flat remains one of the
in 2009 to 22% in 2020. A total of €60.7 billion flowed into the residential investment in large and medium-sized cities. positive correlation between
most important necessities in life,
Despite a COVID-19-induced absolute household growth (over
sector in Europe last year, an 18% growth in activity compared to the five-year average. which ensures that the willingness
rebalancing of migration from the last 10 years), and residential
to pay rent among tenants is high.
urban to suburban and rural life investment volumes. The current
Even with a declining income, the
Residential sector leads in sectors, the more stable housing Will the gradual shift to owner in some markets, the appeal of housing shortage, especially in cities
rent (or mortgage) is one of the first
market is clearly appealing. In occupation in a period of ultra- cities remains strong. The need to such as Berlin and Amsterdam, has
terms of critical mass the North American real estate low interest rates reduce demand
payments that a household makes.
provide efficient public services also led to an increase in rents in
This ensures that rental arrears and
investment market, the residential for rented accommodation? Are and infrastructure continues to recent years, amplifying investment
The housing market is recognised bad debt have a relatively limited
or ‘multi-family’ sector is now the investors buying into the right cities support strong projected growth in activity due to the positive impact
by investors as an ultra-defensive impact on operating income for
dominant real estate sector for in Europe? And what other hidden households in major cities. When on returns and higher vacant
sector that, alongside logistics, residential landlords and investors
investment volumes, accounting risks might they be overlooking? coupled with a lack of adequate possession values (VPV).
closely resembles a risk-free when compared to other sectors.
for 35% of volumes over the last housing supply, and shortages
government bond, but trades at We have structured this report
investment cycle, significantly ahead of space/land to build new That said, there are a number of
a higher yield. It is therefore not The flipside is that receiving income
of the runner-up, offices, at 28%. in order to help answer some markets where high household
surprising that more and more (rent) from multiple individuals/ housing, policymakers face rising
of these questions, examining growth has yet to correspond to
pension funds, insurance funds and households can be far more problems providing a wide range of
While the underlying fundamentals European cities and locations higher levels of investment, such
private equity are increasing their management intensive than households a place in their cities.
point to growth in the residential where residential investment has as Lyon, Warsaw, Brussels and
allocations to the sector. depending on one or a few corporate
investment sector, it is certainly not expanded and has a significant Barcelona. Investment activity not
tenants underwriting the income. It
risk-free and many questions remain role to play in market activity, and only depends on the overall balance
The impact of COVID-19 and an does, however, dilute income risk.
unanswered. Across many locations, gauging their future outlook. of supply and demand, and thus
acceleration in the shift to agile
residential yields are under the fundamental drivers of market
working, notably from home, has
downward pressure. Is this justified? performance, but also on how the
heightened confidence in the
Is urbanisation and household local housing market is structured,
residential sector as the economy
growth as significant as many local funded and regulated.
was squeezed and society went back
city forecasts seem to indicate?
to basics. A quick check of Maslow’s
Hierarchy pyramid reminds us of the
fact that a home is a basic everyday Figure 6:
Figure 7:
need, alongside food, water and European investment activity by sector: annual vs 5yr average
Forecast household growth vs residential investment activity, by city
the clothes on our backs. On the Bubble size: investment volume 2020
other hand, not everyone needs an 30
Difference investment volume: 2020 vs 5yr average,
%
Residential
Houehold forecast growth to 2030, thousands
office to go to work, or to visit shops,
20 Industrial & 640
recreational or leisure facilities – and
Logistics
certainly not every day. Paris
London
10 Seniors housing & care 320
In addition, many investors remain Dev Site
0 Lyon
discouraged by the multiple risks 160 Munich Madrid Stockholm
and potential costs associated with -10
Office Warsaw Helsinki Dublin Amsterdam
Barcelona Berlin
investing in the office, retail and Retail Stuttgart Hamburg Vienna
-20 80 Frankfurt
hotel/leisure sectors. The impact of Marseille Brussels Oslo Birmingham Manchester
agile working, reduced international Cologne Gothenburg Copenhagen
-30
40 Glasgow Edinburgh The Hague Utrecht
travel, e-commerce and the growth Rotterdam
in online meetings, are among the -40 Eindhoven Aarhus
Bristol Leeds
factors pointing to lower demand 20
-50 Dusseldorf
for these spaces. , There is also the Hotel
prospect of rising costs required -60 10
10
to refit and repurpose commercial -80 -70 -60 -50 -40 -30 -20 -10 0 10 20 50 100 200 400 800 1,600 3,200 6,400
space to suit changing needs and
Difference in investment volume, %: 2020 vs 2019 Residential investment volume, 2020, EUR mn
market dynamics. Relative to other
Source: Colliers, Real Capital Analytics Source: Colliers, Real Capital Analytics, Oxford Economics
06 | European residential on the rise | EMEA Research & Forecast Report European residential on the rise | EMEA Research & Forecast Report | 07
The impact of housing market structure Figure 8:
Residential tenure by city
and financing policy on investment 100
Owner occupied market Private rental market Social housing
Houehold forecast growth to 2030, %
allocations 90
80
Housing tenure: Great proportion of the Polish population. Changing regulations on LTV or
This, combined with an aspirational loan-to-income (LTI) ratios can
aspirations mindset, will ultimately lead to have far-reaching consequences
70
greater demand for owner-occupied for private rental housing demand.
Many housing markets in Europe 60
and private rental properties. The same applies to regulations
are characterised by a large
regarding the allocation of social
proportion of owner-occupied Germany has the most mature private rental housing. The Netherlands, 50
housing. This trend has grown in an rental housing market, accounting once renowned for the prominence
era of lower interest rates, where for around 60% of stock in the largest and quality of its social housing, 40
the cost of mortgage payments ‘German 7’ cities. This is in stark is now one of the most popular
is lower or equivalent to rent and contrast to all other major cities 30
countries for private rental housing.
owning a home is an ambition for within Europe. The reason for this Although there was very limited
many people. As a result, a home pronounced division is partly due to 20
private rental housing in the past,
is often an individual/household’s
Copenhagen
the established nature of the private
Manchester
Amsterdam
Bimingham
stricter rules such as income testing
Steiermark
Düsseldorf
The Hague
Rotterdam
Barcelona
primary investment, and a major
Bordeaux
Hamburg
Frankfurt
10
Marseille
Stuttgart
rented sector and the strict income
Salzburg
Valencia
Cologne
Warsaw
Aalborg
Odense
London
were introduced in recent years
Utrecht
Munich
Málaga
Madrid
Aarhus
Naples
Vienna
source of future wealth. At the
Berlin
Leeds
Rome
Milan
standards applied when qualifying for for the allocation of social rental
Paris
Lyon
upper end of the scale, home a social rental home, which average 0
housing. Equally, the LTV ratio for
ownership is often a status symbol. between €12,000 (single-person buying has been reduced from
household) and €18,000 (multi-person 106% to 100%. This means that Source: Colliers, Eurostat, Oxford Economics, National Statistics Authorities
In most countries, the government
household) net per year. By way of more, especially young, households
has traditionally stimulated home
comparison, in the neighbouring are dependent on a private rental
ownership through policies such as
Netherlands the income limit is much home for a longer period of time.
tax benefits, reducing the scope for
higher at €40,042 gross per year, As a result of these structural shifts,
private rented accommodation. In Figure 9:
which amounts to approximately a foundation has been laid that
addition, the maturity of a private
€30,000 net per year. The clear European residential housing - typical loan-to-value ratios, by country
rental housing market depends on investors can utilise, driving growth
implication is that many more Dutch in a market that was very small in
the regulation and accessibility of 120
%
citizens can apply for social housing the Netherlands until recently.
social rental housing. For example,
than Germans.
the accessibility of social rental
housing in Poland is quite high. 100
This not only results in a very large Housing finance: Changes
“While established clusters
social housing market in Warsaw drive structural shifts
dominate the share of corporate 80
(23% of stock), but also less interest
in rented housing in the private Additionally, fairly strict financing investment, comprising 72%
sector. It is therefore no surprise rules for individuals buying a home of all investment in EMEA,
that the private rental sector in in Germany mean it is customary markets like Spain, Italy, 60
Poland has been limited until now to for loan-to-value (LTV) ratios to be
Russia, Poland, and Hungary,
approximately 10% of housing stock. 80% or less. The hurdle of saving
up for a 20% deposit is reflected in now feature in the top 20 40
Nonetheless, Poland can be seen the average age at which a German destination countries, having
as a strong growth market. As in person buys his or her first home, surpassed $1bn of corporate
20
most other countries, social housing which is 34. This age is lower in investment (individually) in the
in Poland can only be allocated to the Netherlands (30), France (31) last ten years.”
a household that meets certain or Austria (31). This channels a
0
income limits. While a large part of broader group to the German Damian Harrington |
Austria
Belgium
Czechia
Denmark
Finland
France
Germany
Iceland
Ireland
Italy
Latvia
Lithuania
Malta
Netherlands
Poland
Portugal
Slovakia
Slovenia
Spain
Sweden
Switzerland
UK
the Polish population was eligible private rented housing market.
Head of Research | EMEA
for social housing in the past, strong
economic growth and rising income
levels have reduced the eligible
Source: IMF
08 | European residential on the rise | EMEA Research & Forecast Report European residential on the rise | EMEA Research & Forecast Report | 09
Republic and Warsaw. Patrizia
Investment locations
is increasingly finding its way in
expand as rental market Dublin with various purchases
grows over the last three years. These
locations share robust economic
A combination of rising house and demographic prospects.
prices and growing demands for
flexibility and mobility means that When we examine investment
more, especially young, people are allocations in more detail we
opting for rental property in Europe.
see growing investor interest
Despite the fact that home-buying isin secondary cities in Sweden,
incentivised, the investment market Denmark, Germany and the
for rental homes is growing. Netherlands. Mid-sized cities such
as Aarhus (Denmark), Malmö
Investors are seeking to capitalise
(Sweden), The Hague & Rotterdam
on this expansion in demand, and
(Netherlands) come to the fore. This
investment activity is spreading
illustrates the broad scope of the
across the continent. Between
2011–2015, some 61% of total residential investment market, which
European residential investment provides investment options across
volumes were allocated to Germany a range of city sizes. It also reflects
and the UK. By 2020 this fell to the rise in competition for assets,
47.4%. The most popular alternative elevating the challenge of sourcing
countries to invest in include the residential investment product in
Netherlands, France, Sweden and major cities and capitals at attractive
Denmark, a trend that has been prices that will yield returns.
visible for several years.
Despite increasing levels of interest
Emerging investment destinations in the European housing market,
include Spain, Ireland, the this interest often remains highly This is partly due to the complexity Figure 11:
Czech Republic and, to a lesser localised. If we look at standing of national housing markets, as well Residential investment momentum, by city
extent, Poland. Heimstaden, for investments by the 50 largest as a lack of transparency at a city Bubble size: investment volume 2020
example, recently acquired various residential investors in Europe, only level around pricing, demand/supply 120
Activity volumes: 12M rolling vs 5yr average, %
Bristol
residential complexes in the Czech 33% of the capital is cross-border. balances and return prospects. 110
100
Figure 10: 90
Leeds
Residential investment destinations: Top 10 European countries Barcelona
80 The Hague
Investment volume 2020 Average investment volume last 10 years
70 Munich
20 London
EUR billion
Rotterdam
60 Utrecht
18
50 Manchester
16
40 Birmingham
14 Dresden Gothenburg
30
12 Stockholm Liverpool
20 Copenhagen
10 Oslo
10 Dublin Amsterdam
8
0
6 Berlin
-10 Paris
Vienna Hamburg
4 Frankfurt
-20
2 Helsinki
-30 Madrid
0
-40
Germany
UK
Netherlands
France
Sweden
Denmark
Switzerland
Spain
Ireland
Austria
-50
0 50 100 150 200 250 300
12M rolling activity volume index: 2019=100
Source: Colliers, Real Capital Analytics Source: Colliers, Real Capital Analytics
10 | European residential on the rise | EMEA Research & Forecast Report European residential on the rise | EMEA Research & Forecast Report | 11
Figure 12:
Residential rental growth, by city
35
% rental growth: 2016 - 2020
30 Valencia
Utrecht
25 Stuttgart Rotterdam
Berlin
Málaga Manchester
20 Munich
Hamburg
Düsseldorf Frankfurt
15 Leeds Cologne
Madrid Copenhagen
Bimingham
10 The Hague
5 Vienna
Salzburg Amsterdam
Pricing fundamentals: Encouraging
Graz
0
Naples Rome London
-5
indicators for a thriving residential -10 Milan
Barcelona
investment market
-15
0 5 10 15 20 25
Rent, Dec-2020 (EUR / sqm / month)
Source: Colliers
Supply constraints push Yields continue to fall Urban housing shortage
up rents as demand outstrips contributes to a sharp rise Figure 13: Figure 14:
With the market becoming more
availability in prices Residential yield compression, by city 2020 Rising residential vacant possession values (VPV) 2020
competitive, purchase prices, rental The prime gross yield of As a result of the growth in rents 2016 2016
levels, yield development and the residential properties has fallen and yields, total returns have been Rome +30 bp London +6%
affordability of owner-occupied homes by approximately 40 basis points positive or remained stable. On Kraków Paris +27%
are clearly critical when it comes to Munich +34%
over a four-year period. This average, vacant possession values Wrocław
Amsterdam +34%
evaluating opportunities. It is clear that compression is a function of the (VPV) have risen 26% in just a four- Naples +10 bp Frankfurt +50%
almost all the cities analysed have seen Manchester 0 bp Manchester +18%
strong weight of capital, competition year period. Italy has generated the Copenhagen
rents rise over the past four years. On Birmingham 0 bp +27%
for assets and the anticipation of weakest returns/rises in VPV with an Hamburg +43%
average, rents have climbed 15% but Warsaw Vienna
rental increases, all of which have average decrease of 2.5% over a four- +4%
this masks a wide range of growth Milan 0 bp Salzburg -8%
put upward pressure on residential year period. On the other hand, there Stuttgart
patterns, and rents per sqm, across Málaga -30 bp +33%
asset prices. It is also striking that has been significant, above-average Aarhus Berlin +42%
major European cities. 0 bp
markets showing the greatest drop/ growth in the VPV of various German, Lyon +64%
Valencia -40 bp Aarhus +19%
compression in yields are those with Dutch, Polish and French cities. London Düsseldorf
It is striking that Italian cities have 0 bp +46%
the highest prices. Germany boasts Rotterdam -40 bp Cologne +46%
been on a very different path to Overall, the European housing
the lowest residential yields in The Hague Birmingham +17%
those in other countries, with rents -40 bp Bordeaux
market has been a very lucrative +47%
Europe, at an average of 2.7% across Copenhagen -50 bp Utrecht
declining over the past four years investment. Looking ahead, we +54%
the big German 7 cities. This also Utrecht -40 bp Barcelona +9%
by an average of 6%. At the other expect this performance to continue
highlights the importance of liquidity Amsterdam -50 bp Milan +3%
end of the spectrum, Rotterdam, for at least the short to mid-term, Madrid +29%
and familiarity for many investors. Barcelona -40 bp
Utrecht, Valencia and Stuttgart have Graz +10%
and will not change significantly Madrid -80 bp The Hague
witnessed very high rental growth +52%
Some of Germany’s neighbours such thereafter. Limited planning Vienna -20 bp Rotterdam +58%
of closer to 30%. Overall, the as the Netherlands and Denmark capacity, availability of land/plots Cologne Rome -7%
-82 bp
picture is positive and the rise in Odense +31%
look highly lucrative from a yield for development, and conversions Stuttgart -63 bp Marseille +26%
rents has proven to be an effective perspective, not only because or re-positioning of other assets to Frankfurt -88 bp Aalborg +5%
inflation hedge for investors, residential complexes can still be residential all mean supply is lagging Düsseldorf -100 bp Warsaw +35%
though inflation has only emerged Berlin Kraków +47%
purchased at a relatively lower cost, demand from households, and is -101 bp
Naples -4%
as a concern recently. but also because towns in these ensuring that a housing shortage will Hamburg -66 bp Málaga +32%
Paris -5 bp Wrocław +45%
countries have outperformed the persist for the foreseeable future.
Munich -94 bp Valencia +32%
main German cities in terms of This ultimately benefits both net
rental growth in recent years. cashflow and total returns. 0.00 1.00 2.00 3.00 4.00 5.00 6.00 0 2 4 6 8 10 12
Gross initial yield, % VPV, EUR thousands
Source: Colliers Source: Colliers
12 | European residential on the rise | EMEA Research & Forecast Report European residential on the rise | EMEA Research & Forecast Report | 13
Unaffordability of owner-occupied homes supports the rental market Figure 15:
Housing affordability: income to floor area ratio
Bubble size: Vacant possession value 2020
Rising house prices for owner- for rental properties. Higher house difficult to afford a suitable home.
occupiers in the major cities of prices ultimately stimulate the 45
Possible afforable floor area, sqm
Europe not only ensure favourable affordability gap/ratio, and this is By examining markets on the basis
Warsaw
growth of total returns; they also increasingly visible in most large of average annual household income 40
have a positive impact on demand cities where first-time buyers find it per capita relative to house prices
per sqm, we can estimate what the 35 Marseille
typical resident can buy across major Krakow Rotterdam The Hague
Dusseldorf
cities in Europe. On average, annual 30
The unaffordability of the owner-occupied housing market means Rome Utrecht
Cologne
household incomes will buy someone Madrid Milan Stuttgart
that a large group of people will continue to rely on the private rental 25
approximately 23 sqm of living Aarhus
housing market. Many earn too much to qualify for social rental and Bordeaux Birmingham
Berlin
space – not even a modest studio Barcelona Hamburg
20 Lyon
too little to buy a home. This is a clear driver for investors to acquire or micro-apartment (which tend to Vienna
Copenhagen
Frankfurt
assets in locations with greater affordability constraints, such as Paris, start at 35sqm). This situation is most 15
Amsterdam Munich
Manchester
London, Amsterdam and Munich. severe in Paris, where an ‘average’ London
Paris
household income can buy only 10
Frank Verwoerd | Head of Research & Market Intelligence | 11sqm of living space. In comparison,
Netherlands an average income in Warsaw will 5
buy almost 43sqm.
0
Regulatory trends pose risks 0 5 10 15 20 25 30 35 40
Income per capita, 2020, EUR thousands
Discussions and concerns about the the local rental index. This ensures price index (CPI), which varies Source: Colliers
affordability of the housing market no excessive rents are charged and between 0.75% above CPI in Italy to
have been rolling on for decades but that rent rises are limited. 1% above CPI in the Netherlands. This
have recently picked up pace, leading level of market intervention is not
to increasing regulations designed to Berlin introduced the Mietendeckel extraordinary when considering how
accelerate the supply of new housing rent control law in January 2020, commercial leases are structured,
via planning, and to increase the mandating rent reductions which but given residential rental leases are
affordability of the private rented came into effect in November 2020. typically short (1-2 years), managing and does little to counteract partnerships, we expect to see
sector - notably in cities where rentsThe law set rent limits in each area how rents are set is no mean feat for Looking forward:
the rental housing shortages or the capital base engaged in the
have risen excessively. of the city and halted rent increases any government body. Striking a balance for all guarantee affordability in most sector diversify further. Greater
for five years. If a landlord charges
Rules have been introduced in too much rent, they faced fines. This More widespread adoption of the
stakeholders large cities. Given the need for diversification of investments
greater investment to create a across national borders and
Amsterdam that determine the rates enabled hundreds of thousands of Mietpreisbremse scheme, ensuring Despite financing having improved more suitable and affordable rental multiple markets can contribute to
at which new homes may be rented people to get rent reductions, some new leases can only be concluded at in many countries due to low housing offer, which has broader more balanced portfolios, reduce
out for a period of 15 to 25 years. saving hundreds of euros per month. a rental price of a maximum of 10% mortgage interest rates, the owner- economic benefits for a city and all risk and optimise returns – returns
Rents may not increase annually by However, on April 15 2021, the above the local rental index, seems a occupied housing market has its stakeholders, policies need to which the residential sector has
more than inflation (CPI), and homes German constitutional court declared fair way of doing things. But adopting become increasingly inaccessible to be considered carefully in terms of been proven to generate across
may no longer be sold individually the Mietendeckel unconstitutional, this as a widespread practice those on lower-middle incomes. This their impact on the competitiveness more mature markets.
for a fixed period of time (mostly 10 with Berlin having no right to enact across markets will require the data, ensures that a large, typically young and overall attractiveness to
to 25 years). the law. This has resulted in many technology and ‘teeth’ to manage and mobile, group is dependent Although we expect cross-border
investors of cities.
people having to pay back the money the scheme and make it work. on the rental housing market – capital levels to rise, the fragmented
In Germany, regulations on rental they ‘saved,’ and Berlin authorities The deterioration in investment especially in mid- to large-scale cities Given that the bulk of investment nature of local residential markets
prices are increasing, especially in have offered millions of euros in volumes in both Amsterdam and across Europe. ’ Empty-nesters’ are activity in the residential market puts the power in the hands of
Berlin. Two forms of rent regulation financial help to tenants struggling to Berlin (only recently followed by also set to form a larger component in Europe is concentrated in the domestic and local investors who
have been introduced: notably the repay landlords. relief) when these new regulations of demand in years to come. hands of a few, very large and benefit from deeper knowledge
Mietpreisbremse and Mietendeckel were established reflects investors’ established investors, greater and firsthand experience in
for existing rental properties. The While the scheme in Berlin has failed, negative perceptions of such Investors and residents alike investor diversity would be positive locations at a micro level. It is at
Mietpreisbremse was introduced the Germany-wide Mietpreisbremse interventions. The optimal solution is ultimately benefit from consistent for the overall health of the market. this level where the unlocking of
in 2015 and mainly applies to cities remains in effect. It appears that most to create more supply, by supporting policy. The more predictable the As more investors build knowledge opportunities, performing at higher
where there is a tight rental housing countries in Europe want to regulate investment in development, rather risks of engagement the better. and awareness of markets and the rates of return, will most benefit the
market. It ensures that a new lease rental increases in the private sector than imposing regulations that Increasing regulation not only merits of the sector, and seek to growing pool of capital.
can only be concluded at a rental for existing leases. Most seem to reduce willingness to invest and generates unpredictability; it acquire residential assets at scale
price of a maximum of 10% above favour a cap on top of the consumer operate rental housing fairly. undermines confidence in a market via operational platforms and local
14 | European residential on the rise | EMEA Research & Forecast Report European residential on the rise | EMEA Research & Forecast Report | 15
Copenhagen
Amsterdam Berlin
Warsaw
London
Munich
Amsterdam
Paris
Vienna Amsterdam
Top city attractiveness scores
(Scenario 1)
Rent to income affordability 9.3
Quality of Life Index 8.6
Inflation forecast (3yr) 8.4
Madrid Rome
Vacant possession value evolution 7.4
Household growth forecast (10yr) 7.0
10 9 8 7 6 5 4 3 2 1 1 2 3 4 5 6 7 8 9 10
Amsterdam
The following section of the report Demand drivers Investment drivers
provides a comparable city-by- Due to its excellent business climate, many European In recent years, these positive demand drivers have been
city analysis of key factors driving head offices are located in and around Amsterdam. They reflected in Amsterdam’s investment climate. We have
residential investment, as explained act as migration magnets to the city, which has resulted seen an increase in annual investment volume and the
in the Key Trends section at the in an enormous demand for owner-occupied and rental number of transactions. This rise in popularity is not only
front of this report. For ease of properties in recent years. This demand is expected to visible among domestic investors; Amsterdam is also
reference, the 10 cities covered intensify in the medium to long term. With Amsterdam becoming increasingly popular among investors from
are those outlined on the map forecast to grow by an additional 123,000 inhabitants abroad. As a result, we also have seen a sharp decline
above, alongside the list of scoring over the next decade, the pressure on the housing in Amsterdam’s gross initial zield. We are witnessing
components. 10 9 8 7 6 5 4 3 2 1 1 2 3 4 5 6 7 8 9 10 market will continue to mount. Prices are already so high increasing regulation in the housing market from both
that Amsterdam has the third-least affordable owner- the national and regional governments. This mainly
List of scoring components:
The charts representing this occupied homes of the cities examined. This will support concerns stimulation of the owner-occupied housing
data for each city are based on Quality of Life Index Inflation forecast (3yr) demand for the rental housing market in the coming market (lower transfer tax) and regulation in the rental
the methodology for scenario Households Rental price evolution (last 4yr) years. Last year, however, demand fell sharply, mainly housing market (maximum rent increase and additional
one, weighting factors factors to due to the effects of COVID-19 on the movements of exploitation obligations). These regulations ensure
Household growth forecast (10yr) Rent regulation
establish how city catchments (not expatriate workers. This has resulted in rents falling in that domestic investors see more and more challenges
Target population Private rented sector (% of stock) the past year, and they are now at a level similar to 2017. with investment in Amsterdam in particular, and they
just the central areas) score for
core investors looking at depth, Target population growth forecast (10yr) Yield are moving to other regions within the Netherlands.
City (Catchment) However, because the rental housing market is even
stability and income drivers House price to income affordability Yield evolution (last 4yr)
relative to historic and forecast Quality of Life Index 169 more regulated in many other countries, many foreign
Rent to income affordability House price to income affordability
pricing movements, returns and Current no. of households (‘000) 709 (1,555) investors have yet to be deterred.
investment liquidity. Household income per capita Vacant possession value evolution
Target population (20-35 years) 25% (19%) City (Catchment)
Household income growth forecast (3yr) Investment volume
Population growth (households) 8.8% (7.9%) Current gross initial yield 3.5%
Notes:
1. City metrics are based on the NUTS 3 areas that correspond to the city boundary Annual disposable income per capita €23.3k (€22.4k) Yield shift (2017-2020) -40 bps
2. Catchment metrics are based on a wider aggregation of NUTS 3 areas within a 1hour
catchment Affordability (owner-occupied) 16.7 sqm Rental growth (2017-2020) -0.9%
3. Affordability is determined as follows: based on the annual disposal income, a maximum
local financing has been calculated that is set against the median square meter price in the VPV growth (2017-2020) 21%
city. The lower the square meters, the less an average person in the city can buy based on
their salary. Market structure (% PRS) 30.3%
5yr average investment volume (mn) €1,090 (€1,201)
Expected changes rent regulation High
Sources: Colliers, Oxford Economics, Real Capital Analytics, Numbeo, various
16 | European residential on the rise | EMEA Research & Forecast Report European residential on the rise | EMEA Research & Forecast Report | 17
Berlin Copenhagen
Berlin
Top city attractiveness scores Top city attractiveness scores
(Scenario 1) (Scenario 1)
Vacant possession value evolution 9.6 Inflation forecast (3yr) 10.0
Households 9.5 Rent regulation 10.0
Private rented sector (% of stock) 9.5 Quality of Life Index 9.5
Investment volume 8.7 Target population 8.6
Quality of Life Index 8.4 Rent to income affordability 8.6
10 9 8 7 6 5 4 3 2 1 1 2 3 4 5 6 7 8 9 10 10 9 8 7 6 5 4 3 2 1 1 2 3 4 5 6 7 8 9 10
Demand drivers Investment drivers Demand drivers Investment drivers
The Quality of Life Index awards Berlin 164 points, which Berlin’s housing market has recently been hugely popular Investment demand is high in Copenhagen, ranked as Prices have risen sharply in recent years, in part due
puts it in 5th place of the cities analysed and explains its with investors. Because demand for housing is extremely one of Europe’s most liveable cities. Many national and to increased investor demand. Nevertheless, many
attractiveness to German and international incomers. high, both direct and indirect returns have risen sharply international investors see the Danish capital as a highly opportunities remain in the medium term, courtesy of
Over the next 10 years, Berlin is likely to see the number in the last three years, a trend that has stoked investor stable market, due to solid growth a large number of some large-scale developments intended to facilitate
of households grow by 5.1%. Although owner-occupied interest in Berlin’s residential market. As a result, the young households and the current shortage of homes, household growth in Copenhagen. For example,
homes are relatively affordable in terms of the cities gross initial yield has decreased to 2.6% in the past which is exerting continuous upwards pressure on major housing developments are planned for both
assessed, Berlin residents mainly live in private rental three years. Nevertheless, as is the case in Amsterdam, both rents and the prices of owner-occupied homes. the southern and northern harbours. Investments
homes. The demand for these is so high that even a increasing rent regulation is dampening the investment In addition, a reduction in the maximum LTV has continue to be made in the metro network, supporting
private rental housing share of almost 62% cannot climate in Berlin, especially for existing properties. Two curbed the affordability of owner-occupied housing the new locations as promising opportunities for both
accommodate demand, and prices have risen by 9.6% particular new regulations have created barriers for and contributed to an increase in demand for rental householders and investors. Another factor is that the
since 2017. Berlin’s growing population means demand investors. Of these, the Mietendeckel or rental cap, was properties in the city. All this ensures that Copenhagen is new-build market is also relatively accessible to foreign
is likely to remain strong over the coming decade. the most onerous. It stated that new leases of homes one of Europe’s most interesting cities to invest in, partly investors without too many of the kind of regulations
built before 2014 must not exceed a specific price, and because it is still relatively affordable. implemented in peer European cities.
City (Catchment) the prices of old leases must be reduced to no more
Quality of Life Index 164 than the rent cap plus 20%. Depending on the location, City (Catchment) City (Catchment)
Current no. of households (‘000) 2,056 (2,965) this created a price gap that often exceeded 20%, and in Quality of Life Index 187 Current gross initial yield 3.30%
central locations as much as 50% compared to market Current no. of households (‘000) 390 (948) Yield shift (2017-2020) -50 bps
Target population (20-35 years) 22% (18%)
prices. Even though the constitutional court invalidated
Population growth (households) 5.1% (3.6%) the Mietendeckel in Q2 2021, the risk of further
Target population (20-35 years) 32% (26%) Rental growth (2017-2020) 7.7%
Annual disposable income per capita €21.8 (€21.8) government intervention remains high. Population growth (households) 9.2% (6.0%) VPV growth (2017-2020) 14%
Affordability (owner-occupied) 21.5 sqm Annual disposable income per capita €26.1 (€26.9) Market structure (% PRS) 29%
City (Catchment)
Affordability (owner-occupied) 20.3 sqm 5yr average investment volume (mn) €1,139 (€1,456)
Current gross initial yield 2.60%
Expected changes rent regulation Low
Yield shift (2017-2020) -66 bps
Rental growth (2017-2020) 9.6%
VPV growth (2017-2020) 29%
Market structure (% PRS) 62%
5yr average investment volume (mn) €3,046 (€3,114)
Expected changes rent regulation High
Sources: Colliers, Oxford Economics, Real Capital Analytics, Numbeo, various Sources: Colliers, Oxford Economics, Real Capital Analytics, Numbeo, various
18 | European residential on the rise | EMEA Research & Forecast Report European residential on the rise | EMEA Research & Forecast Report | 19London Madrid
London Madrid
Top city attractiveness scores Top city attractiveness scores
(Scenario 1) (Scenario 1)
Rent regulation 10.0 Households 9.5
Household growth forecast (10yr) 9.5 Target population 9.5
Household income per capita 9.5 Household income growth forecast (3yr) 9.3
Investment volume 9.5 Inflation forecast (3yr) 9.2
Inflation forecast (3yr) 8.6 Quality of Life Index 8.4
10 9 8 7 6 5 4 3 2 1 1 2 3 4 5 6 7 8 9 10 10 9 8 7 6 5 4 3 2 1 1 2 3 4 5 6 7 8 9 10
Given the demand drivers, key opportunities for residential
Demand drivers development in Greater London lie along public transport Demand drivers Investment drivers
London’s popularity goes beyond its position as the financial interchanges. Now that remote working is being With its vibrant tourism sector, low unemployment The housing shortage in Madrid means that upwards
hub of the UK. Whilst it is true to say that many choose to live in embraced in London, it is clear that more residents are by national standards and a high number of colleges pressure on both rental and owner-occupied housing
Greater London for work and education, an increasing number of moving further away from the city, but they are still keen and universities, Madrid is a definite draw for the prices has been strong in recent years. However, due
buyers are attracted by London’s history and architecture. Blend on good transport links to key employment hubs. main 20-35-year-old target demographic for rental to increased unemployment, economic uncertainty and
that with the nightlife and culture on offer, through the theatres properties. This in turn explains why Madrid has been - primarily - the dramatic fall in tourism over the last
of the West End to world renowned museums and galleries, and a major destination for Spanish and international year, a likely short-lived decline is visible. It is expected
it isn’t hard to see why London has a winning formula. Investment drivers residential housing investors. The growth in the number that due to the rapid recovery in the tourism sector,
Investors find London more lucrative and quicker of households, and the current housing shortage in among others, growth will quickly return to trend levels.
London almost represents a tale of two cities. The city
to produce returns than other European cities. For the region, are further indicators of strong investment This is the main reason that the national government
performs very well across the economic and socio-
example, the investment volume of 2020 is more than prospects in the Greater Madrid metropolitan area. Even is still looking at legislation to counter any excessive
demographic pillars, but relatively poorly across the liveability
130% higher than the second city in the top 10, Berlin. now that youth unemployment has risen sharply, it is rent increases, especially in cities such as Madrid and
and property pillars. Its large population, generally high
We see few fluctuations in direct and indirect returns expected that demand will rebound quickly in Madrid as Barcelona. Such a law has yet to be introduced, but
income levels, large number of high-quality universities and
because both the owner-occupied and rental housing tourism picks up again, now that COVID-19 vaccinations there is much speculation about it. The most important
staggering number of start-ups are all favourable attributes.
markets are very mature in London. In analysis and are rolling out across Western Europe. challenge for these regulations is to keep the investment
London has the highest house prices of the cities analysed, with practice, it appears that most of the interest in London climate positive, in order to support the wider economy.
an average square meter price of €11,600. Nevertheless, we see City (Catchment) More and more regional governments are being given
comes from institutional investors.
that these prices have not increased enormously since 2017. The Quality of Life Index 164 the opportunity to introduce additional legislation,
expectation is that the demand for quality housing in London London is expected to remain one of the top cities for
Current no. of households (‘000) 2,056 (2,694) which impairs transparency in the residential investment
will remain high. This will drive up prices in the owner-occupied residential real estate in the coming years. Moreover,
market for foreign investors who are not aware of the
housing market even more, ultimately stimulating appetite for it will continue to attract institutional investors in Target population (20-35 years) 22% (31%)
large number of legal differences between regions.
rental properties. In addition, London has the largest target particular, partly because it has proven itself in the past Population growth (households) 5.1% (5.0%)
population for rental housing compared to all European cities, due and now clearly continues to perform well post-Brexit. City (Catchment)
Annual disposable income per capita €18.7 (€18.2)
to the highest student retention levels after graduation as well as Current gross initial yield 3.30%
City (Catchment) Affordability (owner-occupied) 21.5 sqm
internal and international migration of young professionals.
Current gross initial yield 4.00% Yield shift (2017-2020) -60 bps
City (Catchment) Yield shift (2017-2020) 0 bps Rental growth (2017-2020) 2.8%
Quality of Life Index 130 Rental growth (2017-2020) -3.1% VPV growth (2017-2020) 21%
Current no. of households (‘000) 1,505 (6,405) VPV growth (2017-2020) 3% Market structure (% PRS) 18.3%
Target population (20-35 years) 29% (20%) Market structure (% PRS) 28.1% 5yr average investment volume (mn) €1,384 (€1,384)
Population growth (households) 11.9% (9.0%) 5yr average investment volume (mn) €2,410 (€3,396) Expected changes rent regulation High
Annual disposable income per capita €43.9 (€36.4) Expected changes rent regulation Low
Affordability (owner-occupied) 14.1 sqm Sources: Colliers, Oxford Economics, Real Capital Analytics, Numbeo, various Sources: Colliers, Oxford Economics, Real Capital Analytics, Numbeo, various
20 | European residential on the rise | EMEA Research & Forecast Report European residential on the rise | EMEA Research & Forecast Report | 21Munich Paris
Munich Paris
Top city attractiveness scores Top city attractiveness scores
(Scenario 1) (Scenario 1)
Rental price evolution (last 4yr) 9.6 Rent to income affordability 10.0
Private rented sector (% of stock) 9.5 Target population growth forecast (10yr) 9.8
Quality of Life Index 9.0 Inflation forecast (3yr) 9.5
Vacant possession value evolution 8.8 Households 8.6
Inflation forecast (3yr) 8.3 Rent regulation 7.5
10 9 8 7 6 5 4 3 2 1 1 2 3 4 5 6 7 8 9 10 10 9 8 7 6 5 4 3 2 1 1 2 3 4 5 6 7 8 9 10
Demand drivers Investment drivers Demand drivers Investment drivers
Munich is known as one of Germany’s most liveable Because of this supportive context, Munich is a popular Paris’s attractiveness to tourists, students and young Due to high demand for rental properties, the gross
cities, as well as the most expensive. Partly because city to invest in. This is reflected in the initial yield, which workers provides a stable investment base for French initial yield in Paris remains low. The difficulty in Paris
of the popularity of the city and its considerable is the lowest of all the cities analysed. Investors see very and foreign investors. As a result, investment volumes lies mainly in finding suitable large-scale investment
employment opportunities, its population is still little risk in investing in homes in Munich and it seems in Paris are among the highest of the European cities offers. This is partly why more investors are looking
growing strongly, as is demand for new homes. The that they also factor rental growth and value growth into analysed. Further supporting this investment is the fact at alternative cities in France such as Lyon, Lille and
owner-occupied housing market is becoming ever less their pricing. Not only have rents increased by more than that many young Parisians are dependent on the rental Marseille. Nevertheless, a number of large-scale new
affordable for younger people, a trend which in turn 12.6% over the last four years, but house prices have sector because of the city’s high housing prices. The construction projects will be launched in the coming
is increasing demand for rental homes. This dynamic also risen by 26% over the same period. Despite these average house price is currently above €10,000 per sqm, years in conjunction with major investments in the
makes Munich one of the most interesting locations for trends, Munich, unlike Berlin, does not appear to be which means that young households have fewer options infrastructure of Greater Paris. It is expected that, partly
investors, based on the most fundamental drivers of the pursuing further regulation to curb such price increases. to enter the owner-occupied housing market. This because of COVID-19, more households will be interested
housing market. Its approach is primarily to create sufficient new housing ensures that there is a robust and structural demand for in suburban and satellite residential locations that
supply through cooperation with the private sector in rental properties, a demand that is expected to persist maintain easy accessibility to the city. This could be the
City (Catchment) order to enable the further growth of the city. and indeed intensify, partly due to possible adjustments most important investment opportunity for international
Quality of Life Index 177 to the LTI . investors in the coming years. The greatest investment
City (Catchment) risk lies in the fact that the French government continues
Current no. of households (‘000) 875 (2,059)
Current gross initial yield 2.00% City (Catchment) to look for ways to further regulate price increases in the
Target population (20-35 years) 25% (19%)
Yield shift (2017-2020) -50 bps Quality of Life Index 118 housing market, such as the now-implemented Elan Law
Population growth (households) 7.7% (7.0%) (2018). This risk is most acute in cities where there is a
Rental growth (2017-2020) 12.6% Current no. of households (‘000) 1,864 (5,293)
Annual disposable income per capita €33.9 (€30.1) skewed relationship between supply and demand, such
VPV growth (2017-2020) 26% Target population (20-35 years) 24% (20%)
as Paris.
Affordability (owner-occupied) 16.8 sqm
Market structure (% PRS) 62% Population growth (households) 1.4% (5.8%)
City (Catchment)
5yr average investment volume (mn) €557 (€646) Annual disposable income per capita €29.0 (€24.6)
Current gross initial yield 2.25%
Expected changes rent regulation Medium Affordability (owner-occupied) 11.5 sqm
Yield shift (2017-2020) -5 bps
Rental growth (2017-2020) N/A
VPV growth (2017-2020) 18%
Market structure (% PRS) 44%
5yr average investment volume (mn) €546 (€1,327)
Expected changes rent regulation Medium
Sources: Colliers, Oxford Economics, Real Capital Analytics, Numbeo, various Sources: Colliers, Oxford Economics, Real Capital Analytics, Numbeo, various
22 | European residential on the rise | EMEA Research & Forecast Report European residential on the rise | EMEA Research & Forecast Report | 23You can also read
