Southern Europe’s real estate markets are expected to maintain strong momentum in 2026, with growth projected to outpace the wider European Union, according to recent industry research.
Economic forecasts show the region continuing to outperform the EU average, with projected GDP growth of 2.4% in Spain, 2.1% in Portugal, and 1.8% in Greece, compared to around 1.0% for the EU27. This stronger economic backdrop is expected to support both occupier demand and investor confidence across the property sector.
The region also recorded a record year for real estate investment activity in 2025, with transaction volumes reaching approximately €35 billion across Spain, Italy, Portugal, and Greece—an increase of 24% compared to the previous year.
Analysts highlight that Southern Europe’s growth is being supported by structural advantages, including expanding investment opportunities, strong tourism-driven demand, and relatively resilient retail and logistics sectors compared to other European markets.
Energy independence is also emerging as a key factor, with higher reliance on renewable energy helping to reduce exposure to global energy price volatility and improving cost stability for occupiers.
Industry experts note that investor appetite for Southern Europe is shifting from opportunistic allocation toward more strategic positioning, as the region becomes increasingly integrated into long-term European investment portfolios.
The living sectors—including student housing, senior housing, and care facilities—are also attracting growing interest, alongside a strong hospitality market supported by sustained tourism flows.
Overall, Southern Europe is expected to remain one of the most active and attractive real estate regions in Europe, with continued investor interest and stable fundamentals supporting further growth into 2026.
