Rents rise, housing prices fall in European Union

(CN) — Over the past year, housing prices in the European Union and eurozone rose 2.9% and 3.6%, respectively, according to data released Tuesday by Eurostat, representing a big decline from the third quarter of last year, when prices were up 7.3% annually in the EU and 6.6% in the eurozone.

In fact, the decline in the fourth quarter represents the “largest quarterly decrease for the [eurozone] since the fourth quarter of 2008 and first quarter of 2009,” when prices decreased 1.7% and 1.9%, respectively. Housing price increases in both geographic areas are coming off a peak of around 10% experienced in late 2021, but have not sunk to negative territory since the first quarter of 2014, according to historical data.

Eurostat’s House Price Index, or HPI, measures the price changes of all residential properties purchased, whether they are flats, detached houses, terraced houses, or other structures. 

The data from the EU's statistics agency suggests there are currently deals to be found in Denmark, Sweden, Germany and Finland, where housing prices have actually decreased 2.3% or more over the past year. Meanwhile, prices are soaring in countries like Croatia, Estonia, Hungary and Lithuania, where annual increases are 16% or higher. 

Separately, there was a 2.5% rise in rents in the last quarter of 2022, leading to a 19% increase since 2010. Comparatively, housing prices have increased 47% in the past 12 years and have fluctuated significantly more than rent prices, which have more steadily risen an average of 1.7% annually. 

Since 2010, house prices have increased more than 100% in at least eight countries: Czechia, Austria, Latvia, Luxembourg, Lithuania, Hungary, Estonia and Iceland. The latter two have seen prices increase 199% and 217% in the past 12 years, the highest on the continent.

Greece is the only country where rent prices are less than they were in 2010, while housing prices have fallen in Greece, Italy and Cyprus over the last 12 years. 

On the other end of the spectrum, seven countries have experienced rent increases of 50% or greater since 2010: Austria, Hungary, Poland, Ireland, Iceland, Hungary, Lithuania and Estonia. The latter two saw increases of 160% and 216%, respectively. Eurostat is scheduled to release data from the first quarter of 2023 on July 5.

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