Europe is definitely a hot destination, a has-it-all spot for tourists and expats as well. From culture to nightlife, from great cuisine to castles and royal families, from fashion to the Northern Lights, there are so many things to love about the continent (another really cool one is that cities here walkable, with many large boulevards, as well as small charming streets). It’s therefore no surprise that it’s an attractive spot for US buyers who either travel or relocate to a country overseas (Italy, France, Greece, Portugal and Spain are some of the most frequently chosen options).
Europe is also a great choice if you’re looking to invest in a residential real estate asset. Whether it is a vacation home or a place you want to rent, there’s a variety of options on the table. But before actually buying an asset, here are some of the most important things to consider:
- Your why
Defining the reasoning of your purchase is critical, as the implications differ. You could decide to buy a home overseas to have a place to go on holidays, you might rent it for short terms through platforms like AirBnb (still available in selected countries in Europe) or you might want to rent it long-term.
Knowing if you’ll own it to spend vacations comes with different criteria related to budget, location, and amenities compared to a rental property. So what is your why?
- The type of property
Are you looking for a flat/studio? A 2 bedroom apartment? A home? Or maybe a castle-resembling property in the South of France. Are you looking for a European home in a buzzling city or in the countryside?
Depending on your reasoning, you might want to have a bigger or a smaller residence, in a more touristic or calm area, surrounded by nature, sea or in the middle of a crowded metropolis like Paris or London.
If you’re looking to rent long term, you should consider:
- Countries with low homeownership rates, where people are used to living in a rented property - the DACH countries have some of the lowest rates in Europe (according to Statista).
- Countries with a very good digital nomad policy, a trend now in Europe, with many people travelling and working remotely.
- Countries that are known for their universities or educational facilities, that attract many students in search for an apartment.
- Countries in emerging economies that experience a solid year-over-year appreciation rate.
- What city and country should you choose?
There are numerous rankings and lists highlighting the best countries and cities in Europe. The criteria should be well aligned with your reasoning - for example, if you’re looking to buy to move there over the summer, you should know that touristic spots in the South of Europe tend to get extremely hot.
The Expat Insider 2023 ranked Spain as the best country for expats, with great leisure options, culture, nightlife, recreational sports and climate. Spain’s capital city, Madrid, and other cities in the country - such as Malaga, Valencia or Alicante have also made the tops of best cities to live in.
The Expat Insider’s list also includes Portugal as a great choice for expats, with almost anyone speaking English and with a great approach towards digital nomads. Other great countries for expats are Finland, The Netherlands and even the Czech Republic - “80% of expats note that they are very satisfied with the balance between work and personal life in the Czech Republic.” (source)
Switzerland, Germany or Sweden are unsurprisingly rated as having the best quality of life by other tops, but you should also know that these countries are also extremely expensive when it comes to lifestyle in all its details.
If, on the other hand, you’re looking to buy to rent, then maybe more touristic places, such as all the big capitals, on one hand - London, Paris, Berlin, Rome, or well-known areas like Tuscany - are a more intuitive option. On the other hand, Europe thrives with hidden gems that make smaller, less known cities and areas, a great choice for tourists, such as The Azores Island - "granted the EDEN Award by the European Commission for its commitment to sustainable tourism", or Skiáthos, "the most cosmopolitan Greek island in the Northern Sporades".
- Budgets
The residential market in Europe is growing, with estimations saying that it will reach a value of 2.43 trillion in 2029. Nevertheless, research shows a small decrease in prices, for the first time since 2014. Among the countries that recorded lower prices in 2023 are Germany, Sweden, and Denmark, while Croatia and Bulgaria have seen the largest increase.
Among the cheapest countries to buy property are Romania or Greece or North Macedonia, where the average price for a 100m² apartment is around $97,000. At the other end, are cities like Zurich - approx 27.000 USD/sqm, Geneva - approx. 20.000 USD/sqm or London - approx 17.000 USD/sqm (here you can find more prices per sqm).
- Legal aspects to take into account
Starting from VISA requirements to criteria banks and governments take into consideration, make sure to check that you have everything you need to buy your properties.
In Europe, each country has its own unique legislation, as they have their unique culture and language, so dealing with each country’s legal aspects can sound dreary: there are different property ownership regulations (some countries are very strict when it comes to foreign ownership), tax regulations, renovation regulations etc.
A legal advisor or a platform like VAUNT market can make all the process easier and help you make this whole process easier, faster and safer.
- Future plans
Last but not least, when buying a property in Europe, make sure you’re thinking long-term. You already know why you’re buying it, how are you planning to use and manage it in the years to come?
If you plan to keep it as a family vacation residence, take maintenance services into consideration.
If you plan to rent it, get familiarised with agents and platforms to help you do that safely.
If you want to invest and sell it eventually, make sure to constantly follow the market to make sure you buy and sell at the right time.
Are you ready for your next step? Let’s talk and we’ll help you own your dream home in Europe!
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