Fundamentals favour London as a resi opportunity

Among major European cities, we think London offers the best outlook for residential real estate based on demographic trends and supply constraints. Amsterdam and Madrid are also promising. Prospects for cities in France, Germany, and Italy are more mixed, with stretched affordability supporting rental demand, whereas demographic dynamics are relatively weak.

What you will learn:

• We forecast household numbers in Stockholm, Amsterdam and London will rise the most by the early 2030s. London also has a particularly high share of the population in the 20-34 age group, a key metric for rental demand.
• We also project Milan’s younger population will increase healthily over the next decade or so. Alongside Milan’s particularly expensive property prices relative to incomes, and supply constraints, this should support growth in rental demand.
• Berlin and Munich are both forecast to see weak growth in household formation and an outright fall in their 20-34-year-old populations. But in mitigation, the outlook for household income growth in the two German cities is comparatively strong.