European living investment to exceed €70 billion in 2026

Investment in Europe’s living sectors* rose 22% to €62.2 billion in 2025 and is forecast to exceed €70 billion in 2026, according to new figures from JLL.

Stable growth will be driven by large platform deals and a return of core capital, alongside continuing momentum in purpose-built student housing (PBSA) in emerging markets and affordable housing where government subsidies exist.

In 2025 the biggest annual gains came from the UK (+€7.3bn) and Denmark (+€1.4bn). Looking ahead, JLL expects further growth in Germany, Sweden and the Netherlands.

Despite the strong growth, forward transactions remain challenged dropping by 22% year-on-year in 2025. New housing supply in the largest investment markets** fell by 11% in 2024, expected to fall by 5% in 2025 with a further decline of 5% expected in 2026.

Lack of supply is evident in still elevated rental growth, averaging 5.2% at the end of 2025, a small rise from 5% at the end of 2024. Growth ahead of wages has resulted in affordability at the worse level on record. Governments across Europe are increasingly acknowledging the need to stimulate supply to alleviate cost pressures and attract private investment.

Gemma Kendall, Head of EMEA Living Capital Markets at JLL, said: "Investor confidence is clearly returning. We're seeing larger platforms change hands and core capital becoming more active again. The fundamentals remain compelling – yields are compressing and pricing certainty is encouraging buyers back to the table."

Emma Rosser, EMEA living research director at JLL, said: "Momentum is growing in Europe’s living investment markets, however challenges persist in unlocking new supply.

“We forecast new supply will plummet further in 2026, with almost half the level of new supply produced compared to 20 years ago. Institutional investment in collaboration with governments will be essential to reversing this trend.”