The European real estate sector will begin to stabilise from mid-2024 onwards, according to executives from US bank, JP Morgan, and global advisor, CBRE, at an event in London.
Massimo Saletti, MD and global co-head real estate at JP Morgan, and Jonathan Hull, head of EMEA clients at CBRE, analysed the evolution of the financial landscape over the coming months during The District gathering this week, with a focus on the general uncertainty currently being experienced in EU countries.
According to the speakers, the market will be ‘reactivated’ within the next two or three quarters, although significant activity is not expected by the end of 2023.
Inflation and high interest rates were also highlighted as the two main causes of the slowdown in real estate transactions in recent years, following the pandemic, and which have kept investors in a position of inactivity and "wait and see".
‘At the moment the situation revolves around rising prices and interest rates. We have very stubborn core inflation, and interest rates have gone up more than people thought,’ said Hull. ‘And I think that's spooked a lot of investors, so they've become very cautious,’ he added.
However, Saletti wanted to send a message of tranquility in recognising the drop in rates that had been coming, which is why the yields have now been surpassed.
Some movements are being observed in the market with one early indicator being the entry of Asian capital into cities such as London.
