• Living investment is concentrated and growing. Living is the largest sector globally and is forecast to retain the number one spot with a further $1.4 trillion in transactions over the next five years. The Living 15, the largest investment markets, contributed 98% of living investment and 32% of global commercial real estate investment over the last five years, with investment rising 19% from the previous five years.
• Global capital seeks diversity. Cross-border investment has been instrumental in establishing new markets. These purchases accounted for a quarter of living investment over the past five years. This will rise as international buyers are attracted to new locations, various sub-sectors and opportunities for large platform purchases.
• Supply shortages underpin values. Large investors own just 9% of housing across the Living 15 key markets. Over the next five years this living universe is expected to exceed 50 million homes. Investors will strengthen overall supply, but will need to overcome challenges of high construction costs and regulation.
• Urbanization and international mobility drive demand. Trends of urbanization, international mobility and shrinking households mean growing demand for quality rental. The Living 15 key markets will need an extra 21.8 million urban homes within the next decade, investor supply would need to more than double to meet this demand.
• Location, location, location. Successful growth strategies start at the neighborhood level and use strategic place-making to attract tenants and deliver value. Population density, average commute time and proximity to local amenities, have the larger impact on investor returns.

Housing shortfalls versus strong underlying rental demand has been a key driver for investors in the living sector over the past decade. A majority of the world’s largest living markets continue to face housing supply challenges despite strong historic economic growth.

Nine of the Living 15 markets have set national new homes targets in a bid to increase supply to meet demand. However, all nine of those countries failed to meet their target in 2024, with most building at a rate of around 60-75% of target.

Institutional scale investors have played a significant role in easing supply pressures over the past decade. A total of 6.5 million new purpose-built rental units have been delivered in the Living 15 between 2014 and 2024.

Construction challenges will continue to inhibit housing supply in the coming years, although as cost inflation slows and debt pricing normalises, this should ease. Investors’ ability to innovate, be that through repurposing other use classes or using modern methods of construction, will mean not just more homes delivered in the next decade, but better quality housing also.