Madrid and Barcelona Among Top European Cities for Real Estate Investment

February 3rd, 2016

The latest report on “Emerging Trends in Real Estate Europe 2016” prepared by PwC and the Urban Land Institute, forecasts good real estate prospects for the larger cities in Spain, especially for  the cities Madrid and Barcelona.

Madrid remains ranked in fourth position among the most attractive European cities, after Berlin, Hamburg and Dublin, with 5,000 million euros in real estate investment between October 2014 and September 2015.

Barcelona rose one position to 12th place, and is part of a group of 18 cities with optimistic prospects for investment in 2016.

In the European framework, the report predicts that the lack of quality assets and the abundance of capital will boost real estate development and investment in alternative sectors to the traditional ones, according to 80% of those surveyed.

El Mundo reported that 55% of those questioned said they believe that capital will continue entering strongly into the market this year 2016, thanks to low interest rates in Europe and the consequent greater appeal of real estate investment compared with the low return on fixed income securities.

However, quality assets will continue to be scarce, according to another 40% of the respondents, while 63% believe that those available will be overvalued in virtually all the European markets.

However, the report also points out that as the housing market is undergoing transformation, opportunistic investors are considering a wider range of investments, such as pension funds, wealth management, traditional real estate investments, sovereign wealth funds or insurance, which have more modest expectations for returns.

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