Europeans got rich on real estate — where and how to make money

Investing in real estate remains one of the most reliable ways to grow your wealth in Europe. During periods of economic instability when financial markets fluctuate, real estate offers stability and the potential for passive income. Due to its high liquidity, relative predictability, and potential for value growth, this asset becomes more and more attractive for investors.

According to Finance.ua, real estate investment is particularly effective in European countries because it combines stable income, relatively secure investments, and the potential for asset value growth.

Why do Europeans choose real estate?

The European approach to investing in "stone and concrete" can be explained by several factors:

• Stable markets with clear regulation provide investors with transparent rules.
• High liquidity: Assets can be sold quickly without significant loss of value.
• Passive rental income: Housing, offices, and resort apartments generate income even without the owner's active participation.

For Europeans, real estate is not just a place to live; it's also a financial instrument.

The most popular types of real estate for Europeans

Investors in Europe typically allocate their investments across four primary categories: residential, commercial, recreational, and land.

Residential real estate is a stable classic

Apartments and private houses are the most common choices. In megacities like Paris and London, the starting price is 300,000 euros, while in smaller cities, it starts at 100,000 euros.

Yields average 4-9% per year, and in areas with high rental demand, they can reach 11-12%.

Housing in Europe is often rented through professional companies that manage properties, which increases efficiency and simplifies life for investors.

Commercial real estate is for experienced investors

This segment includes offices, retail spaces, and business centers. The cost of entry is high — starting at 500,000 euros — but the profit potential is high as well.

Yields average 6-12% per year. Long-term contracts with tenants minimize risk.

Large cities such as Frankfurt and Barcelona attract international companies, so commercial real estate is in steady demand there.

Recreational Real Estate: Betting on Seasonality

This includes hotels, apartment complexes, and villas by the sea, which can be rented out to tourists. The minimum investment is 200,000 euros.

The annual yield is 8-15%. Seasonality plays a key role, as income depends on location and management costs.

In countries such as Spain and Greece, this type of investment is especially popular among retirees and expats who want to earn money while enjoying their leisure time.

Land plots are risky but promising

The cost of land ranges from tens of thousands to millions of euros. It is affordable in rural areas and expensive in the capital.

Features:

• The main profit is made at the resale stage.
• Profitability depends on a change of purpose or infrastructure development.

This type of investment often involves legal complications and requires careful analysis.

Yields by country:

• In Germany, the average rental income is approximately 4% per year. The annual increase in property value ranges from 3-5%. This makes it suitable for stable, low-risk investment.
• In France, the rental yield is 3-5% per year. Capital appreciation ranges from 2-4% per year. This asset is popular among investors who value reliability and prestige.
• In Spain, investors can expect 6-7% annual rental income. Due to the demand for housing in tourist regions and large cities, capital growth is 5-8%.
• Poland is one of the most dynamic countries. Rental yields are 5-7% per year, and capital gains are 6-10%. These indicators are due to the active development of the economy and growth in urbanization.
• In the Czech Republic, the average rental income is about 6% per year. Real estate values also show steady growth of 5-9% per year. The country is appealing to long-term investors.
• In Portugal, rental yields are around 5% per year. At the same time, property values are growing by 4-7% annually. Portugal is particularly attractive to investors in the tourism and resort sectors.

What affects income?

The success of a real estate investor depends on more than just the location or type of property. The following factors are also important:

• Tax legislation: For example, France has high taxes on rental income.
• Rental demand is consistently high in cities with students or migrants.
• Political stability and economic growth are also important.

All of these factors should be considered during the planning stage of an investment.

As we previously reported, Northern Cyprus has become an even more attractive destination for foreign investors thanks to its Mediterranean climate, picturesque beaches, and affordable real estate prices, which have now been supplemented by new advantages. Recent changes to the Turkish Republic of Northern Cyprus's legislation have greatly simplified the process of purchasing real estate for non-EU citizens and Turkish Cypriots.

Also, analysts have ranked the cities where buying a home in prestigious neighborhoods requires a fortune. From Monaco to Los Angeles, these are the world's most expensive cities.