Falling interest rates will spur a revival in the real estate capital markets, according to CBRE’s 2024 European Market Outlook. But tepid transaction activity and subdued economic growth are likely to make 2024 another challenging year for real estate before a more convincing recovery in 2025. As inflation continues to cool in 2024, CBRE expects interest-rate cuts by the ECB in first half 2024, followed by the Bank of England in second half.
For real estate, prime capital values in Europe are expected to bottom out in 2024 as interest rates stabilize. But the cost of debt is likely to remain high and, consequently, CBRE anticipates only a modest uptick in investment activity.
“As capital values solidify and the economic backdrop continues to improve, buyers and sellers will start to become more comfortable with new pricing levels,” said Tasos Vezyridis, head of thought leadership for Europe at CBRE. “We are anticipating higher investment volumes in 20
