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With European property prices dropping as the recession bites, European cities are emerging as the place to invest.

As European economies stagnate, property markets are also affected. With real estate markets from Ireland to Spain turning from boom to bust, property investors are looking for new safe bets from the UK to Russia.

A survey of real estate experts shows that Germany, France and UK are less risky in these troubled times, with Russia and Turkey emerging as the new safe zones.

In this series of articles, we will discuss the possibilities of top ten European places to invest in real estate, both in and out of the European Union. The first article in the series is a tale of two cities, the two rivaling centres of Europe, Paris and London.

LONDON

London

The good old London, in so many ways the true capital of Europe has always been one of the most attractive markets for international real estate investment. Over the last few years, London has softened in both the residential and commercial sectors. According to the Land Registry, sales are down 10% from last year, and investment firm Knight Frank notes that mortgage lending is down 30% from last year. A gross domestic product that’s fallen to 0.4% in the first quarter and inflation above government targets are troublesome to investors.

Having a long history of being one of the world’s cultural, industrial and financial centres, the capital city of the United Kingdom is likely to be the safest bet for real estate investment despite the current one and every potential recession for decades to come.

PARIS

 

Paris

International investors continue to pump money into the French capital, particularly the office market, where vacancies are at all-time lows, according to Knight Frank, a London real estate investment company. Rents in the central business district have responded particularly well, as supply doesn’t meet demand, and there’s limited construction in the pipeline. La Defense, where there’s more construction and slightly higher vacancies, isn’t appreciating quite as quickly.

Similarly to London, Paris is simply too important in so many aspects to be seriously affected by recession.

It appears that old European cities have remained the safest places for real estate investments, and, in all probability, this is not going to change.

However, the “new Europe” is also on the rise, providing the new opportunities for the investors. Read about the possibilities and prospects of real estate investment of Moscow and Istanbul in our next week’s article.



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