UBS reports European real estate markets are entering a new investment cycle with signs of stabilization, as UK property markets show growth and yields improve across Europe.
Bollywood Fever: UBS has reported a shift in European real estate markets, signaling the start of a new investment cycle.
According to the report released on Thursday, key indicators point to market stabilization after a challenging period marked by inflation and rising interest rates.
The UK saw a promising 6.5% quarter-on-quarter growth in Q2 2024, contributing to an overall 1.6% growth across Europe.
The eurozone, however, faced a 1.9% contraction, mainly due to slower property valuation adjustments.
Despite this, UBS expects the gap to close soon as markets stabilize. Improved risk-adjusted yields are also helping create a more favorable investment environment, aided by easing inflation and stable interest rates.
While Germany’s residential real estate market is showing signs of stabilization, weaker leasing fundamentals in lower-quality office spaces continue to drive upward pressure on yields.
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