The European luxury real estate market is about to enter a new phase of expansion in 2025. According to the “2025 European Prime Price Forecast” report, produced by consultancy Knight Frank, cities such as Stockholm, Marbella and Madrid lead the ranking of residential markets with greater forecast growth in prices. Lisbon occupies an outstanding fourth place, surpassing places such as Monaco, Milan and London, and reaffirming its position as a privileged destination in the prime segment.
With a growth forecast of 4.5%, the Portuguese capital stands out among European cities that attract more and more foreign investors. Francisco Quintela, founding partner of the real estate agency Quintela e Penalva, a Knight Frank partner in Portugal, highlights, in a statement, that political stability, economic growth and quality of life are key factors that drive this demand. The opening of new air routes, especially to the United States, has also contributed to diversifying the buyer base, with a growing flow of customers from the United Kingdom, the United States and the Middle East.
In addition to Lisbon, also Porto and peripheral areas are emerging as attractive areas for investment. The forecast is that urban redevelopment projects in these regions will attract new investors, creating innovative residential products that change the local real estate landscape.
On the other hand, Stockholm’s lead, with an estimated 6% growth, reflects an economic recovery following a 13% decline in prices since June 2022. The reduction in interest rates by the Riksbank, the Swedish central bank, was crucial to boosting investor confidence. This recovery trend positions Stockholm as one of the most dynamic markets in Europe.
Just after Stockholm, Marbella and Madrid share second place in the rankingboth with forecast growth of 5%. These Iberian cities stand out for their combination of sunny climates, excellent international schools and hybrid work opportunities, which attract buyers looking for a high-quality lifestyle. According to the IMF, Southern European economies will outperform many eurozone economiesfurther strengthening the demand for luxury residential properties.
In fifth place in the ranking, Monaco maintains its attractiveness with ultra high net worth individuals (UHNWIs). The limited supply of properties, combined with a low tax environment, ensures price resilience, even in a scenario of increasing global fiscal pressure.
Despite economic and political challenges in Europe, the luxury real estate market continues to be one of the most transparent and attractive sectors for global investors. The combination of high quality of life, access to world-class schools and a strong transport infrastructure promises to keep the continent on the radar of major investors in 2025. Lisbon, in particular, emerges as one of the most promising destinations, confirming its place in the top of the luxury residential markets.
Source: www.must.jornaldenegocios.pt
