Property prices on the rise in Europe, except in France and Belgium
Market research agency Standard & Poor’s has released its property price projections for Europe, revealing that prices will increase in most Eurozone countries for the rest of 2015 but fall in France and Belgium.
According to forecasts by S&P, the combined effect of low interest rates and a more favorable economic climate will cause housing prices to rise in most European countries in 2015. Leading the race is Ireland, expected to experience the most significant growth rates (9%), followed by Germany (5%).
Prices will rise gradually in Portugal, the Netherlands and Spain and stabilize in Italy. A decline of -2% is expected in Belgium, with France bringing up the rear with a -3% decrease in property prices.
Massive unemployment is pinned as the chief cause of this decline, however S&P expects the combination of economic recovery and low interest rates to allow French real estate to bounce back. It is expected to stabilize in 2016 and begin a slow increase in 2017. Other factors expected to halt the price decline are a rise in demand due to demographic growth and a decrease in new construction.
Additionally S&P cites the “level of household debt, weaker that in other European countries” as supporting growth in France in the longer term.
S&P forecasts for property prices in the Eurozone (2015/2016/2017):
Ireland: +9% / + 5% / + 3%
Germany: +5% / 4.5% / 3.5%
Portugal: +4% / 3% / +2%
Netherlands: + 3% / 3.5% / 2.5%
Spain: +2.5% / 2.5% / +4%
Italy: 0 / +2.5% / +3%
Belgium: -2% / 0.5% / + 2%
France: -3% / 0 / +3%
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