Italia and Spain are driving growth in the property sector in Europe

Italia ranks just behind Spain in terms of expected growth. From €162.7 billion in 2025, the figure is forecast to rise to €194.1 billion in 2027, with growth rates of 8.7 per cent in 2026 and 9.8 per cent in 2027, thanks to growing foreign interest and an increasing focus on major cities and the most attractive tourist destinations’. The UK shows a more balanced but steady growth trajectory, with the market reaching €164.2 billion in 2027. Alternative assets such as student accommodation, the living/multifamily sector and data centres have captured the largest share of the UK market.

The most dynamic prospects are found

are centred in Mediterranean Europe, whilst France and Germany are preparing to continue to act as stabilising markets for the entire system. Logistics continues to be the most dynamic sector in almost all countries, driven by structural changes in distribution systems, e-commerce and the growing need for modern logistics infrastructure to support demand.

The European market is also showing positive momentum in terms of residential transactions and property values: it has moved beyond the post-pandemic and inflationary correction, accompanied by a new phase of revaluation affecting all types of assets. Within the sector, logistics and residential property dominate, recording the best performances when looking at price increases over recent years. In the former of these two segments, the average across the five main European countries rose from an index of 103.4 in 2022 to 116.7 in 2025, with a further projected rise of 3.3 per cent in 2026 and 3.2 per cent next year (as shown in the table on this page, the figures are calculated as fixed-base indices, with 2020 set at 100, and subsequent prices reflect the trend and percentage change relative to that year).

In the residential sector, the picture regarding property values is markedly more fragmented: Spain is the best-performing market, with index increases exceeding 10 per cent between 2025 and 2026 and 7 per cent in 2027; Italia is also performing well, with rises of over 4 per cent. In France and Germany, however, growth – although back in positive territory – remains lower than in the markets of Southern Europe. The office sector, on the other hand, is not experiencing any major upheavals – with average European growth of between 2 per cent and 3 per cent – whilst the retail sector is picking up, showing clear signs of consolidation.

Encouraging data and prospects also apply to the property sales sector, which is expected to see growth over the two-year period 2026–2027, whilst taking into account the potential upheavals that the latest increases in the cost of borrowing could cause in the market. Once again, Italia and Spain top the rankings for dynamism and growth performance: the former outstrips the latter in terms of the number of transactions (800,000 sales forecast for 2026 and 840,000 in 2027), trailing only England and France. The latter experienced the sharpest correction between 2022 and 2024, but the recovery that began in 2025 is now expected to continue this year and next. Similarly, the German residential market is thought to have passed the most difficult phase of the cycle, but the persistent housing shortage and the slump in construction activity – driven by high construction costs, planning difficulties and higher interest rates – continue to weigh on the market.