Best places in Europe to buy a luxury second home, buy-to-let
Whether you’re on the hunt for a vacation property as travel reopens, or you want a store for your cash as stocks somersault, Europe can offer a host of compelling second-home destinations.
From access to fine food and rich culture to stunning scenery, the continent has something for everyone — and property purchasers are buying in.
In the past year, Europe’s prime real estate market has grown 5.6% amid continued demand, according to new research from international real estate agency Knight Frank. Meanwhile, rental returns in the region’s most in-demand vacation destinations continue to rise.
“For second homeowners, Europe’s cities offer culture, connectivity and a good quality of life, whilst for investors they offer strong tenant occupancy and relatively low purchase costs,” Kate Everett-Allen, head of international residential research at Knight Frank, told CNBC.
The growth comes as investors search for safe-haven assets and income-generating investments as inflation soars — with interest extending across the Atlantic.
Yet, as with any investment, purchasing a property is a big financial commitment, and knowing where to start can be tricky. Using data from Knight Frank, here’s CNBC’s rundown of the best places to start looking for a second property in Europe.
Top cities for property price growth
If you’re in the market for capital growth, consider casting your eye to the ever-alluring cities of Western Europe.
Price growth in Europe’s prime real estate markets — categorized as the top 5% of the market in value terms — has been among the highest in the world in the past year, according to Knight Frank.
Berlin, Germany has seen the strongest price growth in the year to June 2022, with high-end properties appreciating 12.6% on average.
Berlin property prices have appreciated at the fastest click across Europe’s prime real estate market, according to Knight Frank.
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The annual uptick puts the German capital’s growth rate well ahead that of other global cities like New York (7.3%), Hong Kong (3.1%) and London (2.5%).
Elsewhere, property price appreciation has been strong this year across the high-end real estate markets of Edinburgh (11.2%), Dublin (10.2%), Zurich (10.2%) and Paris (8.9%).
The slowdown will be felt most in lower price brackets and domestic-driven markets.
The continued rise of the region’s top cities comes as growth rates slow across the global property market amid rising interest rates and a darkening economic outlook. However, Knight Frank said the slowdown has not yet translated to property prices — with the luxury sector proving particularly resilient.
“Rising mortgage rates and a weakening global economic outlook are cooling some of the ebullience of the last two years, but the slowdown will be felt most in lower price brackets and domestic-driven markets,” the report noted.
Making an overseas property purchase is not without its challenges, however. Before embarking on an overseas purchase,…
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