- European living investment volumes reached €59 billion in 2025, the strongest annual total since 2023
- Cushman & Wakefield survey of institutional investors shows 96% plan to increase allocations to living assets
- Private Rental/Build to Rent sector expected to outperform in 2026
- UK, Spain and Germany remain top destinations
- 82% say sustainability is a strategic priority
Stronger sector performance, rising institutional activity and a stabilising macroeconomic outlook are helping to build renewed momentum across Europe’s living sector, according to the findings of Cushman & Wakefield’s latest European Living Investor Survey.
Just as the living sector records its strongest annual outturn since 2023, with €59 billion invested during 2025, Cushman & Wakefield’s survey shows a consistent deepening of engagement from institutional capital. Two thirds of respondents now allocate 20% or more of their portfolios to living assets and 96% expect those allocations to rise over the next five years. Stability of returns remains the leading attraction for 74% of investors, supported by demographic resilience and broad‑based demand across residential products. The Private Rental Sector (PRS)/Build to Rent (BTR) and Purpose-Built Student Accommodation (PBSA) subsectors continue to lead investor interest, while appetite for affordable housing, cost‑rental and emerging co‑living formats is growing as strategies diversify.
Tom McCabe, Head of EMEA Living Research at Cushman & Wakefield, said: “The data shows a sector that has regained its footing. After a period of adjustment, performance has stabilised and the underlying demand drivers remain firmly intact. We are now seeing investors re‑engage with greater clarity and capital is being directed towards assets and markets with proven income performance, and the living sector is benefiting from that renewed focus.”
Patrick Hogan, Head of EMEA Living Capital Markets at Cushman & Wakefield, said:
“What stands out in this year’s survey is the consistency of investor conviction. Allocations are rising, strategies are broadening and the appetite for living assets is becoming structurally embedded within portfolios. The sector’s resilience in 2025 has clearly reinforced that confidence.”
Macroeconomic Sentiment Stabilises
Macroeconomic expectations among investors, prior to the current conflict in the Middle East, appeared to have settled, with more than half of respondents expecting no change in interest rates over the next year and 48% anticipating no change in prime living yields. Expectations for yield compression have tempered, with performance increasingly expected to come from rental growth and operational efficiency.
The Private Rental/Build To Rent sector is expected to be the best performing segment this year, ahead of Purpose-Built Student Accommodation (PBSA) while investors see lack of investment opportunities, lingering buyer-seller pricing gaps and political/regulatory risks as the main challenges this year.
The Private Rental/Build To Rent sector is expected to be the best performing segment this year, ahead of Purpose-Built Student Accommodation (PBSA) while investors see lack of investment opportunities, lingering buyer-seller pricing gaps and political/regulatory risks as the main challenges this year.
Markets of Choice Remain Consistent
Germany, Spain and the UK rank as the most favoured markets, reflecting the depth of institutional stock and strong rental-demand dynamics in those markets. The UK and Germany alone accounted for 66% of investment volumes last year. Ireland has moved ahead of France within the next tier of preferred destinations, highlighting subtle shifts in sentiment across the region.
Existing Stock Anchoring Demand
Investors currently favour existing stock, with nearly half reporting that 80% to 100% of their living portfolios are in stabilised assets. That bias is of little surprise given the young age of the sector and the viability headwinds of recent years - particularly construction inflation - which raised delivery risk and likely pushed many investors toward stabilised assets.
Joint ventures and stabilised acquisitions are expected to remain the most common routes to market in the next one to three years, with forward funding and forward commitment models expected to stay relatively soft . The exception to this trend is in newer markets where institutional supply is emerging, such as Belgium, Italy, Poland and Czech Republic.
Location was ranked as the single most important consideration when assessing PRS and BTR schemes, followed by tenant affordability. Amenities and sustainability features also play influential roles, though they sit behind the fundamentals that underpin leasing performance.
Joint ventures and stabilised acquisitions are expected to remain the most common routes to market in the next one to three years, with forward funding and forward commitment models expected to stay relatively soft . The exception to this trend is in newer markets where institutional supply is emerging, such as Belgium, Italy, Poland and Czech Republic.
Location was ranked as the single most important consideration when assessing PRS and BTR schemes, followed by tenant affordability. Amenities and sustainability features also play influential roles, though they sit behind the fundamentals that underpin leasing performance.
Sustainability Remains Important
Sustainability remains a key consideration within living investment strategies. A total of 82% now identify it as a key objective and most are willing to pay a premium for assets with strong environmental performance. Investors perceive sustainability to be less of a priority for tenants however, which may also partly explain its position behind location and affordability when evaluating schemes.
Notes to Editors:
Cushman & Wakefield’s Living Investor Survey was undertaken prior to the current conflict in the Middle East.
Cushman & Wakefield’s Living Investor Survey was undertaken prior to the current conflict in the Middle East.
