Europe Real Estate Sector Set to Grow at 4.50% CAGR from 2025 to 2033 to Hit USD 2.41 Billion

Market Overview

The Europe real estate market was valued at USD 1.62 Billion in 2024 and is projected to grow to USD 2.41 Billion by 2033, registering a CAGR of 4.50% during 2025-2033. The market is dominated by Germany, which holds 32.0% market share in 2024. Key growth drivers include urbanization, an aging population, e-commerce growth, sustainable building development, and advancements in PropTech. The market is supported by a low-interest-rate environment favoring affordable mortgages.

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Study Assumption Years

Base Year: 2024
Historical Year/Period: 2019-2024
Forecast Year/Period: 2025-2033

Europe Real Estate Market Key Takeaways

The Europe real estate market size was USD 1.62 Billion in 2024.
The market is expected to grow at a CAGR of 4.50% and reach USD 2.41 Billion by 2033.
The forecast period is 2025-2033.
Germany held the largest market share of 32.0% in 2024.
Residential properties led with approximately 45.8% of the market share.
Sales transactions accounted for 56.8% of the market, and the offline mode dominated with 64.5% share in 2024.
Rapid urbanization, rising homeownership demand, and growing foreign investments in prime locations support market growth.

Market Growth Factors

Growth in the European real estate market is driven by rapid urbanization, increased population in large cities such as London and Paris, and others including Berlin. 69% of the EU's total population is a homeowner in 2023, and they spend an average of 19.7% of their disposable income on housing. Built-up areas and residential and commercial properties are expected to increase. Between 2010 and 2023, property prices increased 48% and rent increased 22%, despite properties becoming less affordable during this time.

Besides these long-term trends, the low interest rate environment has lowered borrowing costs in many European countries, thus stimulating homebuyers and investors to demand. Another factor influencing housing demand are government initiatives for promotion of home ownership, including tax exemptions for first-time home buyers. Lifestyle changes resulting from the rise in remote work have also increased demand for more space and suburban living.

Increased foreign investment is important for the prime property markets of London, Paris and Southern European countries. Foreign investors are attracted to stability in property values, high rental yields, exchange rates, growth in tech hubs and co-working spaces, and sustainability and infrastructure improvements to property markets, which have increased property values and prices.

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Market Segmentation

Analysis by Property:

Residential: Largest segment in 2024, representing approximately 45.8% of the market, driven by urbanization, economic stability, and demographic trends such as an aging population and young professionals. Governments promote housing affordability policies to address demand.
Commercial
Industrial
Land

Analysis by Business:

Sales: Lead the market with about 56.8% share in 2024, propelled by economic stability, affordable financing, foreign investment, and technological advancements in property management.
Rental

Analysis by Mode:

Online
Offline: Dominant mode with 64.5% market share in 2024, driven by buyer preference for personalized face-to-face interaction, trust in agents, complex transaction assistance, and local expertise.

Regional Insights

Germany is the dominant market in Europe, holding over 32.0% share in 2024. The country's market growth is supported by strong economic performance, rapid urbanization in cities like Munich, Frankfurt, and Berlin, and significant foreign investment. Germany's stable political climate, well-developed infrastructure, and adoption of sustainability initiatives and smart technologies further augment its real estate market appeal.

Recent Developments & News

March 2025: Telescope, a Norwegian prop-tech startup, raised EUR 3.7 million in seed funding to aid European real estate owners in climate compliance via a SaaS platform analyzing physical and biodiversity risks.
March 2025: Manova Partners launched the Manova European Logistics Real Estate Fund II (MELREF II), targeting EUR 300-500 million with a 5% yield focusing on prime logistics assets across Europe.
March 2025: Apollo Global Management started its first European real estate credit fund seeded with USD 170 million, targeting senior loans to low-risk properties.
December 2024: Lionel Messi's real estate investment trust, Edificio Rostower Socimi, debuted on Spain's Portfolio Stock Exchange with a market cap of EUR 223 million, owning properties in Spain, Andorra, London, and Paris.
June 2024: Four former executives from Cromwell Property Group and Valad Europe founded MC Property, a pan-European industrial real estate investment firm.

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Key Players

Telescope
Manova Partners
Apollo Global Management
Edificio Rostower Socimi
MC Property

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