Property Market In Europe Expected To Stabilize

The residential real estate markets in Europe are expected to stabilize over the next year. However, the housing market in France is forecaster to undergo further damage as the interest rates in the country continue to rise. Economists and real estate insiders in France say that the economic conditions are becoming weaker and housing affordability is limited as credit standards have become tighter and continue to decrease residential property prices in the country.

However, there are tentative signs pointing towards the achievement of stability in prices in other European countries. The next two years are crucial in determining the future of the continent, and the outlook appears good at the moment. As a matter of fact, market insiders expect improvements in every European nation excluding France.

There are many nations which are yet to deal with reeling housing markets following the burst of the real estate bubble. Countries such as Spain had experienced some of the hardest times recorded in modern history. Although prices are expected to go down by eight per cent in Spain and by around five per cent in Italy over the course of 2013, the decrease is set to slow. In other major European nations where residential real estate prices are on the rise, increases are set to slow as we enter into 2014.

Real estate activity to drive economic growth

According to many economists in the continent, a recovery of domestic residential property markets could prove to be a powerful source as economic activity in Europe seeks a boost. In addition to residential investment, even consumer spending will increase and eventually help domestic markets recover in due time.

However, France is expected to experience a further decline in property prices as stats suggest that the country’s residential values will fall to four per cent next year in comparison with three per cent this year. One of the main reasons as to why France may suffer is the country’s high expectations of attracting interest from the US and the UK. The laws in France are very strict and potential buyers are cautious about investing in the nation’s real estate market.

No hope for France just yet

The number of French home buyers has been declining over the years, and the taxes on real estate sales are expected to be revised next year, thus causing a further decline in interest. Housing prices in France have remained quite stable in comparison with other countries since the economic crisis unfolded in 2008. But sales are reducing more than prices.

Market insiders say that homes in France are still considered expensive by investors who are also scouring other European markets. Although France was thought to have dealt with the recession during Q2 this year, the growth of 0.5 per cent means that sustainability is still very far. Orders for residential real estate assets in the country are expected to decline in October this year as staffing level continues to decline at several real estate firms.

Source: property-abroad.com/