Although several European countries are still coping with property and economic crises, international investors continue to be bullish in regards to the European real-estate market, driving further growth in several European property markets into 2018 — with the exception of the UK, which will be experiencing a post-Brexit uncertainty. Taking into consideration the uncertainty in the European property market, is buying property in Europe still attractive? And, more to the point, can investors expect a great return on their property investments in the present climate? As Head of the Real Estate Investment Strategy at BNP Paribas Fortis, Pol Robert Tansens has expertise in the area of wealth management. Mr Tansens discusses the major European real-estate trends and the outlook international buyers can expect when they choose to buy property in Europe. BNP Paribas Fortis offers a comprehensive network of specialised branches for expats, with extended opening hours. Their specialist multilingual advisers are happy to answer all of your questions whenever it suits you best. Why are real-estate investors still flocking to Europe? Just a few years ago, everyone was predicting the conclusion of Europe — especially the end of continental Europe — but we’ve still seen ever-increasing property prices as investors flock to the markets, particularly in the main cities in Germany and, more recently, several Nordic locations. But property markets in Europe, whether commercial or residential, are actually very expensive. Considering that crises are high and property assets are trading at incredibly low property yields, this makes the underlying value of properties very high. So how is it feasible a continent experiencing modest economic growth with a still-low inflation — though improving, albeit slowly — continues to attract investors from all over the world? The solution is easy: it’s all linked to the monetary policy of the European Central Bank (ECB), rstate and it’s nothing regarding real estate. With the ECB’s loose monetary policy of keeping interest rates artificially low — in early September 2017, actually, the ECB decided to keep interest rates at 0.00% for an “extended amount of time”— investors don’t see some other possibility than buying real estate. Buying stocks could be too risky as they are volatile, and bonds are costly considering yields continue to be hovering around very low levels. Even if it’s expensive and the yields aren’t high, real estate still provides a cash yield or a net rental income of several percent, which really is a high return in comparison to zero interest offered on other assets. But, in ways, it is also dangerous that property prices are supported by this monetary policy of the ECB. The truth is that some emerging markets are in big trouble with declining growth rates, rstate turmoil, lower commodity prices and rstate volatility in currencies. Rich investors from emerging markets are looking at Europe because they had to diversify due to such problems. For a continent that has been a complete write-off less than a decade ago for investors, those same investors are now purchasing Europe. Everything we have been predicting is the actual opposite: there are property markets performing well in general with plenty of international capital flows. Essentially, real estate is equal to a secured bond, particularly if you buy in the prime property markets in Germany, for example. But anywhere in Europe, rstate you still have the possibility of an improved economy and higher inflation positively influencing your investment. This is the key reason why property in continental Europe and recovering markets has performed so well.