The rising cost of living is the top area of concern for European citizens, according to a 2024 Eurobarometer survey.
The finding is perhaps unsurprising as the price of housing continues to increase across the EU. In the fourth quarter of 2024, house prices in the region increased by 4.9%, while rents rose by 3.2% compared to the same period in 2023. Over the course of 2024, the annual growth in EU house prices was 3.3%, and rents saw a 3.1% increase.
Price fluctuations varied across Europe, with some countries even experiencing declines. But which European countries experienced the highest increases in house prices and rents in 2024?
According to Eurostat, in 2024, the annual average change in house prices across the EU ranged from a decrease of 5.2% in Luxembourg to an increase of 16.5% in Bulgaria.
House prices declined in France and Germany in 2024
In addition to Luxembourg, house prices decreased in France (–3.7%), Finland (–3.5%), Germany (–1.6%), and Austria (–0.2%) in 2024.
Aside from Bulgaria, significant price increases were seen in Poland (15.0%), Hungary (12.8%), and Croatia (10.4%).
Large jumps were also recorded in Portugal (9.1%), Spain (8.5%), Ireland (8.5%), and the Netherlands (8.2%).
According to the ONS, average annual house price inflation in the UK was 4.6% in the 12 months to December 2024.
Eastern and Southeastern Europe tend to dominate the top of the rankings, showing large increases, whereas Western and Northern European countries occupy the lower end.
Comparing the final quarters of 2024 and 2023, house price rises followed a similar pattern to the whole year average changes. Within the EU, Bulgaria recorded the highest quarter-on-quarter increase at 18.3%, followed by Hungary (13.0%) and Portugal (11.5%).
Among the EU’s four largest economies, Spain saw the highest rise at 11.3%, while France registered a decline of 1.9% over the same period. Alongside France, Finland (–1.9%) was the only other EU country to experience a decrease.
Year-on-year change in this quarter was 1.9% in Germany and 4.5% in Italy.
Turkey stands out as a significant outlier
Turkey, which has experienced high inflation in recent years, stood out as a significant outlier among the non-EU countries on the list, including some candidate countries and EFTA members.
In 2024, house prices in Turkey surged by 41.5%, with a year-on-year increase of 28.5% recorded in the fourth quarter.
Rent increases slightly lag behind house prices
In the EU, rent increases remained slightly below house price growth, both in the annual average for 2024 and in the year-on-year change for the final quarter.
The annual average increase in rents was 3.1%, while the year-on-year rise in the last quarter of 2024 stood at 3.2%. For house prices, these figures were 3.2% and 4.9%, respectively.
Among EU countries, the annual average change in rents ranged from a decline of 0.9% in Estonia to an increase of 12.4% in Hungary. Estonia was the only country where rents decreased.
Eastern European and Balkan countries recorded the highest rent increases, while Western and Northern European countries experienced low rent growth or stagnation.
The EU's largest economies, Germany (2.2%) and France (2.3%), both recorded rent increases below the EU average, while Italy slightly exceeded it at 3.2%.
UK rents nearly doubled house price growth
In the UK, rents rose at nearly twice the rate of house prices. Average private rents increased by 9.0% in the 12 months to December 2024, compared to a 4.6% rise in house prices over the same period.
In the EU, year-on-year rent increases for the final quarter of 2024 ranged from 1.1% in Lithuania to 11.3% in Hungary.
Similar to house prices, Turkey emerged as a clear outlier in rent increases, with an even greater disparity. In 2024, the annual average increase in rents reached 117.2%, while the year-on-year change in the final quarter was 109%.
To better understand property trends in Turkey, it is more useful to consider real (inflation-adjusted) changes, as wages have also risen significantly in nominal terms in recent years. For instance, the nominal net minimum wage increased by 71% in 2024 compared to 2023.
