Construction is not keeping pace with the growing demand in most countries, which will lead to an increase in apartment prices almost everywhere, with the exception of China and France, Euronews writes.
Global housing prices are forecast to rise in the next two years, according to Fitch Ratings.
In 2025, the most significant increase in the price of apartments and houses is expected in the Netherlands, Canada, Brazil and Mexico. In Canada and the Netherlands, this will be due to government programs to support first-time home buyers, and in Brazil and Mexico, to higher wages and construction costs.In China, a slowdown in the economy will lead to lower real estate prices.
In France, housing will continue to fall in price due to a decrease in the purchasing power of citizens and political uncertainty in the country. Neither the limited supply nor the reduction of mortgage rates will help. However, prices are expected to decline more slowly than last year and are likely to start rising in 2026.
In the Netherlands, price growth is expected to slow from 13% in 2024 to 8-10% in 2025 and 6.8% in 2026. This is still one of the fastest growth rates in the world, mainly due to the shortage of affordable housing.
According to forecasts, in Spain in 2025, the value of real estate will be 4.6% higher than in 2024, and in 2026 prices will rise by another 5.7%. Lower inflation and loan rates have had a beneficial effect on demand. Meanwhile, according to the report, there are still not enough new homes.
In Germany, house prices are expected to rise between 2 and 4% in 2025 and 2026, which is higher than Fitch estimates for 2024 (+1.5%). On the one hand, weak wage growth is expected to limit affordability, while on the other hand, continued rent increases will make buying an apartment more attractive.
In the UK, Fitch also expects modest house price growth of between 2% and 4% in 2025 and 2026. The upturn will be linked to lower mortgage interest rates, a strong labor market, and rising nominal incomes.
In Denmark, lower interest rates and moderate growth in disposable income will lead to a 2% to 4% price increase in 2025 and 2026, according to Fitch.
House prices in Italy are expected to rise by 0.5% to 2.5% in 2025-2026. Moderate indicators are associated with a decrease in demand, mainly due to high mortgage rates.
"We expect mortgage rates to decrease to 2.5% over the next two years, but to remain significantly higher than before 2022," Fitch said in a report.
The results of 2024 and forecasts for 2025 are in our summary material.
Source: Euronews
