Catella: Demand pressure in European commercial residential markets – yield decreases aren’t measured

Catella Research examined the commercial residential markets of 59 cities in 19 European countries: the lowest yield in Stockholm, the highest in Krakow. The highest rents in London, the lowest in Vilnius. The average purchase price for owner-occupied flats is at 4,616 €/sqm. Highest transaction volume in Germany.

In the 19 countries analyzed by Catella, a total transaction volume of EUR 48.1 billion was achieved in 2017. 32% of this was achieved in Germany alone, followed by UK with a share of 15%. The taillight in this ranking is Belgium with merely EUR 55.8 million.

Further single results of this analysis:

– The lowest yield of all European residential markets can be found in Stockholm with 1.50%, followed by Zurich with 2.20%. The highest yield can be found in Krakow with 7.44%, followed by Warsaw with 6.15%. The average European yield is at 3.97%.

•  The lowest average rent is in Vilnius with 8.75 €/sqm, closely followed by Riga with 9.25 €/sqm. The most expensive rental flats by far are found in London with average prices of 40.78 €/sqm. Behind that, the continental city of Bern follows with 34.10 €/sqm. The average price of the 54 presented rental prices in Europe is at 15.21 €/sqm.
•  The city of Vilnius has the lowest purchase prices for owner-occupied flats with an average of 1,470 €/sqm. The second lowest city is Wroclaw with 1,520 €/sqm. The most expensive prices per square meter for owner-occupied flats are also paid in London with 16,935 €/sqm. Zurich is in second place with 1,007 €/sqm and therefore ahead of Paris, where the average price is 10,030 €/sqm.

“The demand pressure in the European commercial residential markets will sustain. In 31 of 59 cities, a slight decline of yields is expected by the end of the year, while increasing yields aren’t expected in any European city”, explains Dr. Thomas Beyerle, Head of Group Research at Catella. “For investors, the Polish cities seem to have the most attractive yields”, Beyerle continues.

The full analysis is available at catella.com/research.

Catella Research examined the commercial residential markets of 59 cities in 19 European countries: the lowest yield in Stockholm, the highest in Krakow. The highest rents in London, the lowest in Vilnius. The average purchase price for owner-occupied flats is at 4,616 €/sqm. Highest transaction volume in Germany.

In the 19 countries analyzed by Catella, a total transaction volume of EUR 48.1 billion was achieved in 2017. 32% of this was achieved in Germany alone, followed by UK with a share of 15%. The taillight in this ranking is Belgium with merely EUR 55.8 million.

Further single results of this analysis:

– The lowest yield of all European residential markets can be found in Stockholm with 1.50%, followed by Zurich with 2.20%. The highest yield can be found in Krakow with 7.44%, followed by Warsaw with 6.15%. The average European yield is at 3.97%.

•  The lowest average rent is in Vilnius with 8.75 €/sqm, closely followed by Riga with 9.25 €/sqm. The most expensive rental flats by far are found in London with average prices of 40.78 €/sqm. Behind that, the continental city of Bern follows with 34.10 €/sqm. The average price of the 54 presented rental prices in Europe is at 15.21 €/sqm.
•  The city of Vilnius has the lowest purchase prices for owner-occupied flats with an average of 1,470 €/sqm. The second lowest city is Wroclaw with 1,520 €/sqm. The most expensive prices per square meter for owner-occupied flats are also paid in London with 16,935 €/sqm. Zurich is in second place with 1,007 €/sqm and therefore ahead of Paris, where the average price is 10,030 €/sqm.

“The demand pressure in the European commercial residential markets will sustain. In 31 of 59 cities, a slight decline of yields is expected by the end of the year, while increasing yields aren’t expected in any European city”, explains Dr. Thomas Beyerle, Head of Group Research at Catella. “For investors, the Polish cities seem to have the most attractive yields”, Beyerle continues.

The full analysis is available at catella.com/research.