Emerging Trends in Real Estate®: Europe 2026

Now in its 23rd edition, the Emerging Trends in Real Estate®: Europe 2026 report is based on a joint survey by PwC and the Urban Land Institute (ULI), providing an in-depth outlook on the real estate market across Europe for 2026 and beyond.

Faced with the reversal or moderation of a number of historic tailwinds, including low interest rates and globalisation, this year’s report shows the real estate industry is adjusting to a prolonged period of transition. At the same time, the industry is being forced to redefine the value of the asset class in face of increasing competition from infrastructure and other investment options.

While politics, war in Ukraine and conflict in the Middle East continue to cast a long shadow over real estate capital markets, deglobalisation is adding to the challenges as governments and regions increasingly prioritise their own interests. The proportion of respondents that now view deglobalisation as a key concern has more than doubled in this year’s survey, from 31% in 2024 to 70% this year. 

Changes in US policy have also significantly impacted investment sentiment. The rapidly evolving tariff policy initially interrupted investment momentum in early 2025, but some suggest the unpredictability of the US economy will encourage Europe-focused deals in 2026. Others believe the US still compares more favourably against the limited economic growth and instability in key European markets.

Although there are challenges, the real estate industry remains resilient with leaders acknowledging that they must get to grips with the reality of the market as it stands if they want to prosper. And despite macro headwinds, there are some positive signs. Most expect debt and equity availability to increase in 2026, fuelled by emerging investors such as European and US family offices, high-net worth individuals and private equity funds. 

It’s also evident that the industry is looking to the long term and placing greater emphasis on secular trends, such as demographics, digitalisation and decarbonisation. Though attracting relatively little capital today, niche operational sectors dominate the rankings with data centres, new energy infrastructure and student housing once again leading the way and signalling the industry’s direction of travel. 

Industry leaders believe there needs to be a selective focus on the cities and regions that combine liquidity with the strongest prospects. It’s no surprise that activity remains focused on Europe’s big cities with London, Madrid, Paris and Berlin leading the city rankings for the fourth consecutive year. But in each case, those interviewed make a clear distinction between the city’s economic growth and the more mixed outlook for the country as a whole.

The popularity of these cities with investors has been reinforced by the perception of greater financial risk in 2025 and over the coming year due to the growing concern about the geopolitical and economic backdrop to real estate. “Paris, London and Berlin are always on our radar,” says a global investment manager. “They offer depth, transparency and liquidity, which are essential for institutional investors”.