European Living Market Dynamics Q4 2025

Private investment in multi-housing and PBSA reached €14.7 billion in Q4 2025, down 2% year-on-year and 36% on the five-year Q4 average.

The PRS REIT £629m (€719m) acquisition by North LGPS and LPPI was the largest deal of the quarter. Declines in the multifamily sector were concentrated in the most mature markets Germany and Sweden, which dropped 75% and 58% below the Q4 five-year averages, respectively, due to a lack of large portfolio and entity deals.

PBSA investment surged 57% above Q4 2024 and 30% on the five-year average, driven by the number of transactions almost doubling. The UK was the largest market in Q4 with investment volumes rising 92% year-on-year, supported by several €100m+ portfolios and forward fundings. Despite the rebound, the UK remained below the five-year average. In 2025, Continental Europe accounted for the majority of PBSA investment for the first time, driven by strong activity in Spain and France.

A strong H2 lifted full-year 2025 private investment to €46.9 billion, up 5% year-on-year but still 25% below the five-year average. Investment is expected to grow further in 2026, supported by strong operational performance and large platforms deals.

Governments across Europe are increasingly acknowledging the need to stimulate supply and attract private investment. This is evident in the EU’s first European Affordable Housing Plan, alongside revised rental regulations in Germany, Ireland, Scotland and Sweden, aimed at incentivising additional housing delivery.

• UK
• Germany
• Netherlands
• France
• Spain
• Switzerland
• Portugal