Many of the real estate markets in Europe are so buoyant at the moment that investors are starting to wonder if this is another bubble. Although some markets are undoubtedly hot, particularly the United Kingdom, we believe that there is plenty of value left in the mature markets of northern Europe and that investors do not have to invest in some of the riskier southern European markets in order to achieve good returns. 

Taking the United Kingdom as an example, does history provide any guide to the current situation? The total return from property in 2014 (17.8 percent) was, in real terms, similar to that seen in the period from 2004 to 2006, which was followed by the deepest recession in property returns since the Great Depression. On the other hand, the 2014 returns are also similar to those seen in the cyclical recovery of 1997 to 1999, but this was followed by a long period of solid returns. So, are we in bubb