EU property sales hit 18-month low
EUROPEAN property sales fell to the lowest level in 18 months in the first quarter as reduced debt funding and concerns about slowing growth deterred investors, according to Real Capital Analytics.
Sales of commercial real estate, hotels, development sites and apartment blocks fell 28pc from a year earlier to 1,506 properties, according to data released by the New York-based researcher. By value, sales dropped 19pc to €28.4bn, the least since the third quarter of 2010.
European banks may scale back property lending by as much as €700bn in the next three to five years as they shrink balance sheets to meet proposed capital regulations, Morgan Stanley estimates.
Spending cuts by governments are hurting growth and lifting unemployment across the continent. The UK, Europe's largest property market by transaction value, entered its first double-dip recession since the 1970s in the first quarter.
"Continued sensitivity to risk among active investors and a severely constrained debt market have hampered investment activity across almost every market," Joseph Kelly, RCA's director of market analysis in Europe, said.