ERA EUROPE

Leaders in Residential Real Estate




2010
®
Market Trends
2009 vs 2008 & Outlook
www. eraeurope. com
ERA EUROPE
RESIDENTIAL REAL ESTATE MARKET TRENDS
Interim Market Review: 2009 Results & Outlook for 2010
Date of Publication: June 2010
This is the first edition of the ERA Europe Market Trends Report, and one of two reports that will be published
annually by ERA Europe. Within this report we offer a comprehensive and up to date perspective on the status of
the residential real estate market in Europe by comparing 2009 to 2008 results as they are available. In addition we
offer insights into the trends of the first quarter 2010 and perspectives for the future. ERA Europe Master Franchise
managers set forth country statistics (available upon the publishing date) from reliable sources such as governmental
statistical offices, bank and mortgage institutions, and equally as important, analyze trends based on information
from their respective ERA networks of brokers and agents. Pure comparison of some figures, however, is very
challenging given the wide variation in types of data tracked in each country. Though there are efforts underway to
harmonize the collection of data on an EU level, it is far from truly being achieved. Therefore the expertise of our
Country Managing Directors and their keen market insights help bring perspective and balance to each market
overview.
The ERA Europe network was founded in France in 1993 and today has grown to 18 European countries with
approximately 1.100 agencies. This report includes only countries where ERA Real Estate is present. For more
information on ERA Europe, visit www.eraeurope.com.
We believe that transparency is key to optimizing results for our clients; both buyers and sellers of residential real
estate. Only then can complete trust be established between all parties involved in realizing a transaction and our
goal of creating enduring, fruitful relationships with our customers be fulfilled.
Team ERA Europe

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 2 of 51
®
Contacts
ERA EUROPE
120 University Park Drive,
Suite 285
Winter Park, FL 32792 USA
Tel: +1 407 657-7992
Fax: +1 407 551-2031
info@eraeurope.com
www.eraeurope.com
ERA AUSTRIA
Gmunden, Austria
Tel: +43 7612 64420
Fax: +43 7612 64430
info@era.at
www.eraaustria.com
ERA BELGIUM
Aartselaar, Belgium
Tel: +32 3 227 41 85
Fax: +32 3 227 41 82
info@era.be
www.era.be
ERA BULGARIA
Varna, Bulgaria
Tel: +359 52 66 13 00
Fax: +359 52 66 13 15
info@erabulgaria.com
www.erabulgaria.com
ERA CYPRUS
Famagusta, Cyprus
Tel: +357 23 816 444
Fax: +357 23 725 263
info@eracyprus.com
www.eracyprus.com
ERA CZECH REPUBLIC
Prague, Czech Republic
Tel: +420 224 83 59 52
info@era-reality.cz
www.era-reality.cz
ERA FRANCE
Versailles, France
Tel: +33 1 39 24 69 00
Fax: +33 1 39 24 69 01
info@erafrance.com
www.erafrance.com
ERA GERMANY
Duesseldorf, Germany
Tel: +49 211 440 37 680
Fax: +49 211 440 37 689
info@eradeustchland.de
www.eradeustchland.de
ERA GREECE
Athens, Greece
Tel: +30 210 322 2254
Fax: +30 210 322 2257
info@eragreece.com
www.eragreece.com
ERA IRELAND
Dublin, Ireland
Tel: +353 1 89 01 722
Fax: +353 1 89 01 723
info@eraireland.com
www.eraireland.com
ERA ITALY
Milano, Italy
Tel: +39 02 393 59 491
Fax: +39 02 393 59 441
info@eraitaly.com
www.eraitaly.com
ERA LUXEMBOURG
Luxembourg
Tel: +352 40 38 981
Fax: +352 40 37 9750
info@eraluxembourg.com
www.eraluxembourg.com
ERA NETHERLANDS
Utrecht, The Netherlands
Tel: +31 30 289 9900
Fax: +31 30 287 1109
era@era.nl
www.era.nl
ERA PORTUGAL
Lisbon, Portugal
Tel: + 351 213 600 150
Fax: +351 213 600 159
info@era.pt
www.era.pt
ERA ROMANIA
Bucharest, Romania
Tel: + 359 888 25 83 94
Fax: + 359 887 94 2217
info@eraromania.com
www.eraromania.com
ERA SPAIN
Alcobendas (Madrid), Spain
info@eraspain.com
www.eraspain.com
ERA SWEDEN
Stockholm, Sweden
Tel: +46 8 442 88 80
Fax: +46 8 442 88 89
info@erasweden.com
www.erasweden.com
ERA SWITZERLAND
Dübendorf, Switzerland
Tel: +41 448 821 004
Fax: +41 448 821 005
info@eraswitzerland.com
www.eraswitzerland.com
ERA TURKEY
Izmir, Turkey
Tel: +90 232 445 14 28
Fax: +90 232 445 14 28
info@eraturkey.com
www.eraturkey.com
www.eraeurope.com
Your contact for this report:
Market Research &
Master Franchise Development
Kathy Auclair
+33 6 61 60 06 29
kauclair@eraeurope.com
European Residential Real Estate Market Trends 2009 & 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 3 of 51
François Gagnon
President
francois@eraeurope.com
Kathy Auclair
Master Franchise Development
kauclair@eraeurope.com
Hélène Gagnon
Chief Financial Officer
hgagnon@eraeurope.com
Paul Van den Putten
Development
paul@eraeurope.com
Table of Contents

A European Perspective on Residential Real Estate 5
ERA Austria 12
ERA Belgium 14
ERA Bulgaria 16
ERA Czech Republic 19
ERA France 21
ERA Germany 23
ERA Greece 25
ERA Ireland 27
ERA Italy 29
ERA Luxembourg 31
ERA Netherlands 33
ERA Portugal 35
ERA Romania 37
ERA Sweden 41
ERA Switzerland 43
ERA Turkey 45
Summary of Tables & Charts 47
European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 4 of 51
A European Perspective on Residential Real Estate
Long & short term views... Important divergences in residential real estate trends emerge in 2010
2010: A tangible recovery in nearly every market where ERA Europe brokers are present.
Perspective. Given the economic turmoil and market uncertainty during this past year we hope to offer some
perspective, (less hype) on how these factors have impacted the European housing sector. It is clear from the ERA
Europe country reports included in this compilation, that there is an important and growing divergence between the
various EU housing markets. Some are faring much better than others, and for different reasons. There is a relative
calm noticed in Northern markets (Netherlands excluded), while economies to the South (ie. Spain, Greece,
Portugal) are still struggling. Other contrasts exist when comparing Western Europe and how they rebounded from
the 2008 setback versus Eastern Europe’s emerging markets. Again, it is all about history, cycles and internal market
dynamics.
To begin, one can clearly state that the home market in Europe during 2009 and thus far in 2010 remains a buyers
market in nearly all countries reporting herein, with the exception of Sweden and Switzerland. As expected, there
are important variations from country to country, each with its own market cycle and macro economic influences.
Furthermore, differences were seen within county regions, as well as rural versus urban centers.
Austerity measures being implemented in the southern European markets versus crisis rescue plans in northern
European markets, all had, and continue to have, a direct influence on the home buying/selling process, and more
precisely consumer confidence.
Having said this, there are clear indications from our 2010 Country Reports that a recovery is being experienced in
nearly every market where we are present. There are important differences in the depth and pace of the rebounds,
and there are a number of factors that could still adversely affect the gains made thus far in 2010. So the markets
remain fragile in many regions.
Nearly all European countries are reporting increase in buyer demand in the first quarter 2010, a slowing in the
pace of price declines, and in the stronger markets, actual price growth when compared to the first quarter of 2009.
Transaction levels are either stabilizing or increasing across-the-board. Mortgage rates remain at historic lows (with
the exception of Bulgaria, Romania and Turkey), and in some cases are even edging slightly upward. Accessibility to
financing still remains a challenge for many buyers who must abide by stricter loan requirements, and more hefty
down payments.
ERA Europe management is on the ground dealing with buyers and sellers of real estate each day; working with
real estate brokers who’s singular goal is to address the needs of their valued clients and to bring greater knowledge,
professionalism, and transparency to the market place. ERA Europe has been operating in the European market for
nearly 20 years, and ERA Franchise Systems, Inc., globally for nearly 40 years. Our Master Franchisors include
within these reports their personal experiences and knowledge of their markets. We know that markets are cyclical;
this is normal and should be anticipated. The 2008 sub-prime crisis that began in the US and so severely impacted
the home market there and subsequently spread to Europe and elsewhere, however, was unprecedented. Therefore
it is our goal with this summary report to offer a balanced and informed view of that market reaction, a clear
perspective of each residential market where ERA Europe is present.
(Important note to reader: a more comprehensive version of this report will be issued and posted towards the end of the year on
www.eraeurope.com web portal. Pending reports from Cyprus and Spain will be included in the second edition. Please contact your local ERA Country
Headquarters or ERA Europe (contact information noted within report) for any questions or clarifications concerning the reports herein.)
European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 5 of 51
European Prices - a view of how the crisis affected prices over the long term
Before viewing specific country reports it is important to understand price history on a European level. A recent
report issued by the European Central Bank (ECB) on residential housing prices for the EU 16 combined (using
2005 as a base year), showed that housing prices peaked in the second half of 2008 with an overall increase of
13,7%. By the second half of 2009 prices on average grew by 9,51% off the base year; thereby establishing a trend
of softening prices (-4,91% off the index high point in 2008) but still remaining in positive-growth territory. When
stepping back even further and viewing longer term price trends, the solid price growth the EU 16 experienced over
the past 20+ years is clear (Chart 1).
Chart 1: Residential Property Price Index Statistics
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Luro Area 16 - kes|denna| Þroperty Index
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Source: ECB Statistical Data Warehouse
Referring to the same report, statistics show Euro area countries that fared the best, in terms of price growth, and
those with double digit increases include: Belgium, Slovenia, Slovakia and Sweden. These countries were followed
by more modest increases in Greece, France, Italy and Austria. Countries that experienced net negative price
growth over the past 5 years include Ireland (the most dramatic decreases of all Euro zone markets), the UK and
Malta.
Short Term YOY European House Price Trends
The housing markets where ERA is established in Europe most affected by the global downturn as well as by
difficult internal economic dynamics in Western Europe, were Ireland and the Netherlands. In Central Europe,
Bulgaria and Romania were the most affected. According to our ERA Ireland Managing Director, Frank Doonan,
there are niches in Ireland where prices have rebounded and some signs of stability within the country are noticed,
however, the overall picture remains bleak with a likely slow, drawn out recovery. Not all housing markets were
touched as dramatically. On the other end of the spectrum were Germany, Switzerland and Sweden. Stable
economies and tightly controlled lending practices helped sustain consistent demand. Sweden was one of the few
European markets exhibiting minimal affects from the crisis. In the middle we find the markets of Austria, Belgium,
and France, with modest transactions declines and modest price corrections, now also showing continued signs of
recovery in 2010.
Chart 2: Change in Average Home Price Capital City
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ERA Europe Market Trends Survey
Trend in Avg. Home Price/Nationally
2009 vs 2008
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European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 6 of 51
Source: ERA Europe
Chart 3: Change in Average Home Price Nationally

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ERA Europe Market Trends Survey
Trend in Avg. Home Price/Capital City
2009 vs 2008
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Source: ERA Europe
Residential Transactions in Europe
Year 2009 was a period of withdrawal and hold for many buyers of residential real estate. Despite attractive
mortgage rates, accessibility to financing was curtailed by implementation of stricter lending practices. Exacerbating
the situation were the many uncertainties in the market place: job security, affordability issues, fear of investment
loss (stock market declines), fear of overpaying (buying too high) or of not selling at the right price (too little
negotiating on the part of sellers), and so on. This is clearly reflected in transaction levels noted below. The most
dramatic downward shifts (declines in the range of 30%) in transactions closed year-on-year (YOY) were found in
the countries Bulgaria, Cyprus, Greece, Ireland, Luxembourg the Netherlands and Romania. Cyprus with -48%
and Bulgaria and the Netherlands with approximately -30%, recorded the most dramatic drops in transaction levels.
These were also countries which, in pre-crisis times, had the steepest price increases. Sweden was surprisingly
resilient in contrast to all other markets.
Chart 4: Change in Residential Transactions
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ERA Europe Market Trends Survey
Trend in N°of Residential Transactions
2009 vs 2008
Source: ERA Europe
European Mortgage Markets 2009
According to the European Mortgage Federation (EMF), the market response to the USA initiated sub-prime/
securitization crisis resulted in significant attitude changes on the part of both consumers and lenders in Europe.
European consumer attitudes were to adopt a more cautious approach to spending when taking out loans, while
lenders reassessed their underwriting conditions and the prices of their higher risk loans/products.
The EMF states there were several key observations during 2009 in the mortgage markets:
1. Most mortgage markets continued to experience falls in new lending over the previous year. These falls have
European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 7 of 51
generally stabilized now due to a number of factors: the continued expansionary interest rate environment,
improved housing affordability and some short-term recovery at the macroeconomic level.
2. New lending activity showed some progress in year-on-year terms in Belgium, Sweden and Denmark and, on
the previous quarter, in France, Germany and the UK.
3. House prices continued to decrease over the previous year in all markets surveyed (except for Belgium and
Portugal), but positive developments on a quarter-on-quarter basis were recorded in France, Sweden and the
UK.
4. Mortgage interest rates continued to record substantial decreases both on a quarter-to-quarter basis and on the
previous year, reaching historical lows in some markets.
In 2010 continued stabilization of Euro Zone interest rates is expected. It is the ECB’s policy to maintain its Euro
Zone lending rate which currently stands at 1%, at the same level throughout 2010.
Continued decrease in mortgage interest rates throughout 2009 also impacted consumers’ preferences in terms of
mortgage interest type for new mortgage loans according to the EMF. Their data shows, for example, that there was
a remarkable shift from Q4 2008 to Q4 2009 towards variable rate products in some markets, such as in Belgium
(from 3.7% of total new mortgage loans in Q4 2008 to 47.6% in Q4 2009) and Italy (from 21.9% to 66.5%), where
fixed-rate mortgages are traditionally predominant.
Chart 5: Change in Mortgage Rates (basis points)
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ERA Europe Market Trends Survey
Change in Mortgage Rates (basis points)
2009 vs 2008
!"#$%#&'
Source: ERA Europe
Real Estate Agency Trends
There has been a severe retraction in the number of real estate agencies operating in numerous European markets,
such as Bulgaria, Cyprus, Ireland, Spain, and the Netherlands. Cyprus reports there were over 50% fewer brokers
in 2009 followed by the Netherlands with 44% less brokers operating. Smaller independent brokers with one or two
sales agents, and non-network affiliated offices with tight budgets, narrow operating margins and less service
support, were the most exposed to the swift market downturn. They were not capable of responding quickly
enough, nor did they have ample financial reserves to survive. A sort of ‘cleansing’ of the industry is taking place
and consolidation of the brokerage market is underway. Further office closures are anticipated throughout 2010 in
most of the markets mentioned above. It is now evident that brokers with more substantial operations who have
forged long term business plans and those associated with reputable companies, such as the ERA Europe network,
not only survived the downturn but gained market share. Most importantly, these brokers have also gained
credibility.
The percentage of change YOY in the number of days a listed property remained on the market 2009 vs. 2008, was
rather important in most markets. As residential listing prices come in line with the market demand we see a
shortening of the number of days a property as seen in Portugal, Sweden and Switzerland. On the other hand,
where there is continued resistance to price adjustments listing periods remain more lengthy as seen in the markets
of Bulgaria, Italy and the Netherlands.
European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 8 of 51
Chart 6: Change in Days on Market
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Trend in Days on Market
2009 vs 2008
!"#$%#&' ()*' ()*' !"#$%#&'
Source: ERA Europe
Drivers of the European Housing Market
The diversity of the European housing market is evident as the full spectrum of market conditions are being
reported within this report; however, there are a few key factors, wherever the market, that influence demand for
residential property, they can be divided into three categories; structural, economic and opportunity factors.
1. Structural: Demographic growth is the most important structural factor to influence demand for housing. This
can emanate from local growth in population and population shifts in the form of inward migration.
Demographic growth is inextricably linked to economic growth as a growing economy will attract larger
numbers of foreign economic migrants.
There will be long term growing demand for residential property if there is net growth in population.
Migration is a much more volatile factor as inward migration can reverse quickly if an economy contracts. The
age profile of a population is also crucially important as demand will be strong if large numbers of people
move into the family forming age group of 30 to 40 years.
Geographic shifts of people within a market will also give rise to local variations in demand and therefore
variations in prices paid for residential property. This must be borne in mind when expressing property prices
as national averages.
2. Economic: Income levels and interest rate trends are the most important influencers of demand for residential
property and are usually short term and cyclical. Any positive impact on demand for accommodation from
improving demographics will only be factor if potential investors and homeowners have access to sufficient
capital (percentage of loan to value) at an affordable interest rate. Income levels encompass the hugely
important factors of unemployment and fear of salary reductions as negative demand influencers for
residential property.
The recent and sustained period of low interest rates in Europe led to an increase in owner occupation as
buying a property has become more affordable (percentage of average industrial wage needed to service an
average mortgage). Despite continuing low interest rates, however, demand for residential property in many
European markets has contracted due to tighter bank financed money supply and rising unemployment.
3. Opportunity: This factor relates to the opportunity cost of acquiring accommodation. It is the relative price of
buying or renting a residential property as compared to the prices of other goods. If servicing a mortgage or
rental of a property compares favorably (better value) to how one might otherwise dispose of income, this will
drive demand for suitable accommodation. Opportunity is also a main factor in the level of demand for
various geographic areas and across the various housing categories such as rented accommodation, owner
occupied detached houses, apartments, etc. Contributing source for ‘Drivers’: Frank Doonan, CEO - ERA Ireland
European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 9 of 51
USA Market Trend Glance - First Quarter 2010
The US home marked peaked in 2006 in contrast to Europe where markets began peaking in various countries
from 2006 to mid 2008. It is often said that the European markets follow the US market. So does a US housing
recovery imply a European housing recovery as well? Here we set forth some market trends for 2010 in the US
market and there are striking similarities. Though, the situation remains fragile in the US home market as fears of a
double-dip recession set in, many positive results have been recorded during the initial months of 2010.
Transactions
Existing home sales (completed transactions that include single-family, town-homes, condominiums and co-ops)
increased 7,6% to a seasonally adjusted annual rate of 5,77 million units in April 2010, from an upwardly revised
5,36 million in March, and are 22,8% higher than the 4,70 million unit pace in April 2009. Monthly sales rose
7,0% in March. The US housing market peaked in 2006 when nearly 7 million housing transactions closed.
Inventory
Total housing inventory at the end of April rose 11,5% to 4,04 million existing homes available for sale. This
represents an 8,4-month supply at the current sales pace, up from an 8,1-month supply in March. Raw unsold
inventory is 2,7% higher than a year ago, but remains 11,6% below the record of 4,58 million in July 2008.
Prices - a view of how the crisis affected prices over the long term
The national median existing home price for all housing types in the US was $173,100 in April 2010, up 4% from
April 2009. Distressed homes accounted for 33% of sales in April, compared with 35% in March.
Chart 7: USA House prices 1970 - Q1 2010
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$250,000
$275,000
1
9
7
0

1
9
7
2

1
9
7
4

1
9
7
6

1
9
7
8

1
9
8
0

1
9
8
2

1
9
8
4

1
9
8
6

1
9
8
8

1
9
9
0

1
9
9
2

1
9
9
4

1
9
9
6

1
9
9
8

2
0
0
0

2
0
0
2

2
0
0
4

2
0
0
6

2
0
0
8

2
0
1
0

P
r
i
c
e

Year
USA House Prices
Inflation-adjusted house prices
Nominal house prices
Source: US National Association of Realtors (NAR)
Homeownership Rate:
US Homeownership rate is currently at 67,1%, a reversal back to levels recorded in quarter one of the year 2000,
and dropping from a peak of over 69,1% in 2005. The US Federal Reserve Bank of New York states that the rate
could potentially fall even further by another 5 percentage points to levels seen in the mid 1980’s.
Chart 7: USA Homeownership Rate 2005 to Q1 2010
66
66.5
67
67.5
68
68.5
69
69.5
2005 2006 2007 2008 2009 2010
!"#$%&'(&)*(+,-./$012(,$
Source: US Census Bureau
European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 10 of 51
What will continue to drive the US market?:
- Continued low interest rates
- Government tax credit inducements (ending on 30 April 2010)
- Improved consumer confidence
- Favorable affordability conditions
European and USA Market Comparisons EU 27
Statistical year/
Source
USA
Statistical year/
Source
Population in Millions (1) 500 2009 307 2009
Households in Millions 209 2009 106 2009
Housing units in Millions N/A 130 2010 est
Persons per household (2) 2.4 2007 2.59 2009
Homeownership 71.0% Eurostat 67.10% US Census Bureau
Broker market share 50.0% ERA Europe est. 79% NAR
Average Home Price N/A $173.000 Apr-10/NAR
Average Home Price N/A €141.455 Conversion 1€ = 1,22$
Supply of homes N/A 8 Months NAR
Owner Occupied w/o Mortgages 44,8% Eurostat N/A
Owner Occupied with Mortgages 27,2% Eurostat N/A
Disposable income spent on Housing 21,9% Eurostat N/A
Unemployment 2010 10% Eurostat - 2010 9,7% US BoLS - 2010
(1) An increase of 3,2% over 2008 to 500.482.231. Most populated EU 27 country is Germany, least populated is Malta. Population increases are due to immigration (8
out 10 new people). Germany and Spain are the countries with highest number of new immigrants
(2) Highest density was in Turkey, lowest in Germany. A total of 27,7% of European households have only 1 person, compared to the equivalent US average of 27,3%
(2006 est.)
European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 11 of 51
ERA Austria
Austrian homebuyers feel pressure from the global downturn. Rental demand rises, sale of flats vs. homes
increases, pursuit for urban centers accelerates.
AUSTRIA
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average
Days on
Market
2009 vs 2008 -2.22% -1.61% -0.59% 0.00% -3.95% 0.00% Buyer -5.00%
Trend 2010 Decrease Decrease Decrease Unchanged Decrease Unchanged Buyer Decrease
European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 12 of 51
General
Among those seeking a residence in Austria in 2009,
over one-third sought to purchase a single family
home. However, based on comparisons with 2008
figures, the demand for these type of homes was down
by as much as 20%. Additionally, when reviewing the
demand for mortgage loans only every second loan
was honored by mortgage bank institutions. This is
mainly due to exercising of restrictions of the Basel II
banking regulations, which is an attempt to regulate
finance and banking internationally. Contrarily, in
2009 demand for rental properties was on the rise by
30% year on year and these rental seekers represented
about one-third of the demand for housing.
Buyers who sought high loan-to-value ratios (i.e. 80 to
90%) in the past years when purchasing their home,
had to explore other options in 2009 or simply put-off
their plans to purchase a home. Those decided to buy,
in spite of the market difficulties, opted for flats. This
group of buyers represented 34% of the homebuyer
market in 2009; a significantly higher portion than in
2008. Many buyers who were flush with cash opted to
purchase flats in the city centers, as this is still
considered a secure and traditional form of investment
in Austria. However, a good portion of potential
buyers simply gave up. According to a 2009 survey of
home buyers: 38% of respondents stated that securing
financing had become more difficult; 6% of
respondents stated that they had to entirely abandon
their dreams of a purchase and as an alternative chose
to rent; 20% stated that due to the many difficulties
encountered when seeking to buy, they instead chose to
remain in their existing residence for a longer period of
time.
The majority of real estate seekers in Austria desire to
live in the city center or in the immediate vicinity,.
Only one-third desires to live in the suburbs, a trend
which intensified following the crisis. Currently we are
experiencing a renaissance of the cities. In general, it is
perceived that cities with a developed infrastructure
and business environment offer more security in terms
of jobs. Homeowners also have to consider both the
time and costs of traveling to and from their
workplace. This further intensifies trends toward
purchasing a home in the city.
In 2008 the majority of homeowners in rural areas
wished to keep their countryside residences under any
circumstance; however, more recent trends for this
group indicate they are prepared to move closer to city
centers. Even so, the move will not be too far from
their current residence. It is reported that 56% of
buyers seek homes close to their current residence,
26% in the neighborhood within 15km of their actual
residence and only 10% seek homes in another
province.
The top reasons for changing a residence are 1) size/
space 2) infrastructure 3) energy efficiency and a desire
for more attractive surroundings. In general, homes
with quality features and amenities are in greater
demand. Poorly equipped dwellings in low-grade
condition and inadequate energy efficiency are a very
difficult sell.
In 2009 there was an increase of 11% of buyers who
said that they wished to improve energy efficiency
when seeking another home. Top criteria such as
having a nice terrace and a garden, remain. Two-thirds
of the buyers are looking for “new built” property
while only 25% is willing to live in old buildings.
Properties constructed between 1950 and 1980 are
experiencing a serious image problems as they must be
renovated, modernized and made more energy-
efficient in an effort to improve their salability.
European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 13 of 51
Regional Tendencies
The capital cities (of the 8 provinces) are the clear
winners in terms of real estate demand. Strongest
demand was found in Kärnten (Carinthia) and on the
other end of the spectrum was Burgenland with lowest
demand. In the most southern parts of Austria
demand concentrates around the Vienna suburbs,
especially the southwest region towards Tulln and
St.Pölten.
The most attractive region was Mödling, with the
strongest increase in house moves indicated in
St.Pölten county. In Burgenland, only the more
charming areas around the lake Neusiedlersee were
attractive buys. The Südburgenland area (Vinearea),
however, became less interesting for buyers. In upper
Austria; Linz, Wels and Steyer (center line), all
experienced good demand. As did the lake areas of
Salzkammergut. In Salzburg county, the city of
Salzburg remains a sought after location (price increase
for houses were around 6% in 2009). Tyrol, the capital
City of Innsbruck, and the holiday region Kitzbühel
also experienced great demand. In Vorarlberg we can
see the highest demand for homes in the area of the
capital city Dornbirn.
Research from the leading Realestate Media
Immobilienmagazin revealed that due to the
unprecedented difficulties experienced in the real
estate market in 2009, four out of ten Austrian real
estate brokers are in serious danger of either losing or
closing their businesses. This group is mainly found in
the segment of non-network brokers. Nevertheless,
certain networks, such as ERA Austria, have not only
been able to maintain existing offices but have
improved their business results and reached
extraordinary achievements under these difficult
circumstances.
Transactions
The increased regulations in the banking sector had its
influence on the number of transactions registered in
2009. Transactions decreased from about 90.000 in
2008 to 88.000 in 2009;,a modest decline of 2,2%. At
the time of this writing, transaction data was not yet
available for 2010; however, indications are that
transactions are showing a very stable trend in
comparison to 2009, with an up-tick in new housing
sales as mortgage financing remains very attractive for
this particular sector.
Price Tendencies
While the general trend is negative, price tendencies
tend to differ in the various regions of Austria. For
example, home prices in Salzburg City, at the northern
part of Austria, increased by approximately 6%, while
Salzburg County, experienced an overall decrease of
15% in prices over the year. This trend, however,
already changed in 2010. There are other areas where
prices dropped dramatically, by up to 20%. Prices were
more stable in the most attractive areas of the country,
and in some cases higher, because of decreasing
number of sellers in these parts of Austria. In
Innsbruck and Salzburg, for example, the number of
buyers is four times as high as the number of sellers.
Mortgage Rates
The banking/mortgage industry in Austria is highly
competitive which has resulted in interest rates
remaining quite low, and they should remain so for the
coming year. According to the European Central Bank
rates were at 67% of the September 2008 peak by June
2009. Typically loan terms range between 10 to 20
years. According to the Austrian MFI’s the average
loan rate was 3,51% in mid 2009. Only one in two
loans were honored by mortgage bank institutions in
2009, mainly due to exercising of restrictions of the
Basel II banking regulations. Buyers that have 20-30%
cash on hand have a better chance of getting more
attractive loans with a lower interest rate: the better
their Basel II-rating, the lower the mortgage rate
applied.
However, a possible change in this dynamic may occur
in 2010 despite historically low ECB rates, if there is
increased pressure on Austrian banks (already with
comparatively low margins to the rest of Europe) from
a growing exposure to bad real estate loans. A
weakening in the banking sector can have an
additional impact on this trend. It is yet to be seen how
these developments may affect the mortgage markets.
Outlook
For the short term it is anticipated that the housing
market will remain relatively stable without dramatic
shifts, up or down, with regard to house pricing,
transaction levels and interest rates. Consumer
confidence will be swayed during the year by concerns
over the Euro devaluation and inflation. Many
uncertainties on the horizon allow only a short term
view of the housing markets. Nevertheless, we can say
that many consumers wish to invest their funds in real
estate for fear of greater losses elsewhere. All in all
buying real estate in Austria is currently an attractive
investment for people with cash.
ERA AUSTRIA
Gmunden, Austria
Tel: +43 7612 64420
Fax: +43 7612 64430
info@era.at
www.eraaustria.com
ERA Belgium
Prices remain stable, transactions decline slightly, the Belgian housing market resist; with a gradual recovery
anticipated during 2010
BELGIUM
N° of
Residential
Transactions
Avg. Home
Price/Capital
City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller Market
Average
Days on
Market
2009 vs 2008 -6.95% -1.69% -0.31% -1.07% 0.00% 0.00% Buyer 13.40%
Trend 2010 Increase Decrease Increase Decrease Unchanged Unchanged Buyer Increase
European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 14 of 51
Summary
As expected, Belgium came through the worldwide
real estate crisis relatively unscathed. In 2009 112.719
homes were sold, this was only 7% less than in 2008
and the average sales price was down by only 0,31% to
an average of € 192.000. The number of transactions
in the capital Brussels was down 17,5% but the average
transaction price was down by only 1,69%, at an
average of €231,814.
Houses versus Apartments
The Belgians mainly live in single-family homes as
opposed to apartments. About two-thirds of residential
properties sold, 77.000 out of a total of 112.000, are
houses.  The average transaction price of € 198.721 for
a house in 2009 was down by only 1,4% compared to
the year before and the total number of houses sold
was 5,6% less for the year.
In 2009 a total of 36.000 apartments were sold in
Belgium, this is 10% less than 2008. Contrary to what
might be expected, the average sales price was, at
€177.775; up by 2%.
In Belgium newly build apartments sell at a premium
compared to existing apartments.  As there was a large
supply of new builds, more of these apartments were
sold, which led to the indicated increase in the average
sales price of all apartments compared to the previous
year.
Prices & Transactions-2010 Market Conditions
Belgian notaries reported that after a sluggish start,
mainly due to an unusual cold and long winter, sales
have boomed in the first quarter of 2010. Transactions
were up by 13,7% compared to the first quarter of
2009; a strong recovery from the exceptionally weak
start experienced in 2009.
The average sales price of a house in 2010 has
remained more or less unchanged compared to 2009,
with a modest increase in most provinces and a slight
decrease in others.  The prices of apartments across
the country have increased about 1% on average. ERA
brokers report a continued increase in average
transaction prices but warn that this is mainly due to a
stronger recovery in the middle price range compared
to prices in the lower range. It appears that the
confidence of middle-income families has already
picked up whereas lower-income families remain
hesitant to buy.  Buyers are aware of the exceptionally
low interest rates and they also know that, contrary to
general expectations, property prices have not come
down and are not likely to come down as much as in
most other European countries and the US. 
Mortgages
Long term fixed mortgage rates dropped in early 2009
to just under 5% from a little above 6% in late 2008.
These rates further decreased gradually to around
4,5% at the time of writing.
Outlook
At the time of writing, ERA Belgium is positive about
the outlook and expects a further gradual recovery of
the market, with sales in the lower end market picking
up by the end of the year. However, prices in this
category are expected to remain unchanged. The
number of units sold should also see an upturn in the
year, but total units sold are not expected to return to
the high levels seen in 2007 for some time.
ERA Belgium warns that when long term interest rates
increase substantially, the average transaction price will
decrease again. It is our experience that buyers do not
increase the amount spent on mortgage payments
when rates go up, instead they just buy at a lower price.
The net amount spent on mortgage payments as

European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 15 of 51
ERA BELGIUM
Aartselaar, Belgium
Tel: +32 3 227 41 85
Fax: +32 3 227 41 82
info@era.be
www.era.be
percentage of their income remains unchanged and
the average Belgian will buy a cheaper property at a
time of higher interest rates. Based on the above, ERA
Belgium  recommends buyers not to postpone the
acquisition of a home. By postponing, they run the risk
of not being able to buy the same property with an
unchanged budget.
ERA Bulgaria
Hit hard by the global crisis, both transactions and prices plunge in 2009; Cautious optimism in 2010


BULGARIA
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average
Days on
Market
2009 vs 2008 -29.88% -22.56% -18.23% 2.10% N/A N/A Buyer 100.00%
Trend 2010 Decrease Decrease Increase Increase N/A Unchanged Buyer Unchanged
European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 16 of 51
General
Bulgarians enjoy one of the highest homeownership
rates in the world. Almost 97% of Bulgarian homes
are privately owned. In urban areas one’s home
represents the largest part of household wealth. There
are a number of reasons behind the high level of
homeownership in Bulgaria: the rapid residential
market growth over the last years, dynamic
construction activity, the constantly intensifying
competition among residential developers (thus
providing greater choice for consumers), and the large
number of Bulgarians working abroad. While
homeownership is considered a key indicator of social
status in Europe, in Bulgaria it is not necessarily a sign
of financial prosperity. About 13% of the Bulgarians
own more than one property, and 5% of Bulgarians
also have a country house. The owners inhabit 94% of
the properties while 5% are rented out.
Real Estate Transactions
The number of real estate transactions in Bulgaria in
2009 declined by almost 30% to 217.223, according to
data provided by Registry Agency, Ministry of Justice.
The number of closed deals in 2008 was 309.788. In
the last trimester of 2009 the number of transactions
was 69.115 with this number for the same period last
year being 96.989. This indicates a fall of 28,7% in the
number of transactions when comparing the periods.
Foreign Investment Market
The total inflow of “emigrants’ money”, comprised of
income from abroad and current transfers, declined by
5% over the past year while foreign direct investment
(FDI) in real estate declined by 60%. In the first half of
2009, FDI in construction and real estate amounted to
€ 208 million,  a decrease of 59,3% compared to the
same period in 2008 when the this category amounted
to € 511,2 million. For the 12 months until September
2009 Bulgaria has managed to attract € 836 million of
FDI in real estate.
Prices
Official data for regional cities showed an annual price
decline of 28% in the third quarter of 2009. In
absolute terms, average housing prices declined to
BGN 1.021 per M2 in this quarter. Relative to the
second quarter, market prices have decreased by 5%,
and relative to September 2008 - by 27%, which is the
biggest decline on annual basis reported thus far.
Varna remained the city with the most expensive
housing, as the difference between prices in Varna and
Sofia kept expanding.
Nominal differences between prices in cities with the
most expensive and most affordable housing remain
significant. One M2 of living space in Varna costs
BGN 1.224 more on average than one M2 of a
residential property in Kyustendil, where prices are at
BGN 550 per M2.
Decreases in selling prices outpaced the decline in
construction costs significantly, which means that the
starting of new projects for residential buildings will be
severely limited in the coming quarters, especially in
cities where there is little difference between market
prices and construction costs.
The decline in asking prices in Sofia is about 3 to 4%
relative to our last observation in early September
2009. However, this decline varies depending on the
size of the apartment and the price segment. The most
dramatic drop in prices is seen in the high-end segment
of the market. This type of housing is traditionally
more sensitive to potential changes in the business
cycle. In Varna, in contrast to Sofia, the asking price
decline is nominal for one-room apartments (about
2%) and more tangible for two-room and three-room
apartments (on average 5% and 4%, respectively).
A gradual slow is expected in the decline of both
housing asking and market prices. The slower annual
decrease is partly attributable to the lower starting
European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 17 of 51
point, namely the third quarter of 2008 which was the
first quarter in which the global crisis reflected tangibly
on the dynamics of housing prices in Bulgaria.
2010 Price Trends: Price Declines Ebb Dramatically
According to data provided by the Bulgarian National
Statistical Institute, the average decrease in market
prices of dwellings throughout the country for the first
quarter of 2010 was 2,3% compared to quarter four of
2009 and 17,8% compared to the corresponding
period last year. The average decrease in market values
in larger cities was 4,21% compared to last quarter of
2009.  Prices of specific types of dwellings, namely
those of concrete structures typical of the communistic
era, have fallen at an average of 2% and in some areas
of larger cities  at about 9,51%.  The prices for newly
built apartments have decreased approximately 3%.
Real Estate Agencies
Over the last 6 months many of the real estate
agencies in Bulgaria have closed down as a result of
the slowing real estate market – some permanently and
others only for a short period with the intention to
reopen when the market starts to rehabilitate from the
crisis. In cooperation with ERA global network, ERA
Bulgaria is developing entirely new and modern
managing and training methods to meet the
requirements and the needs of its Bulgarian customer
base. These services will build trust, customer
satisfaction and bring real value added services for
buyers and sellers of real estate.
Mortgages
Early in 2009 adverse affects were already being seen
in Bulgaria from the US and subsequent European
economic crisis. The average volume of a mortgage
loan decreased by 22% and amounted to € 36.260
against € 46.800 in 2008 and € 38.600 in 2007. The
main reasons for the negative shift were: an extremely
weak activity (demand) within the first half of the year
as well as decline in property prices combined with the
requirement for higher levels of buyer funding (down
payment).
The major share of lending volumes concluded at the
beginning of the year, were realized by pre-approved
credit transactions agreed to before the crisis occurred.
Furthermore an increase in re-payment difficulties was
seen in the proportion of home sales that included
mortgages. 
April 2009 was the first month of revival of the
mortgage market caused by the activation of the
housing market.  Within the second quarter of 2009
buyers in the middle class returned to the market.
Early in quarter three of 2009, the average volume of
mortgage loans rose to € 39.200 nationally.  Younger
consumers of mortgage products returned to the scene
as well.  Requests for mortgage loans grew by
15%.  The average size of a mortgage loan has now
reached 2008 levels and exceeds € 40.000.
Mortgages Issued - % by Age Group Mortgages Issued - % by Age Group Mortgages Issued - % by Age Group Mortgages Issued - % by Age Group
Age Group -
Years
2007 2008 2009
18 – 25 10% 7,24% 3%
26 – 35 48,38% 48,46% 53,5%
36 – 45 24,58% 30,79% 26,3%
Over 45 17,07% 13,51% 17,2%
These trends persisted through the end of the year and
the industry reported significant growth compared to
beginning of 2009.
Interest rates in 2009 varied between 8,5% and 9,5%
for a Euro-based loan and between 9,5% and 11% for
BGN loans. During the last quarter of 2009 consumers
in Bulgaria have borrowed amounts averaging between
€ 30.000 and € 50.000.  The general economic
situation in the country led to a decline in allocations
over € 70.000.
The majority of loans are granted for a 16 to 20 year
duration followed by the other most common term of
between 10 and 15 years.  Loans with a maturity
between 26 and 30 years that were the most popular in
2008 experienced a sharp drop in 2009 as significant
rate hikes startled cautious buyers.  The shortening of
the mortgage re-payment period continued until the
end of the year, however consumers continued to seek
optimal repayment terms.
Mortgage Duration - Distribution by Age Mortgage Duration - Distribution by Age Mortgage Duration - Distribution by Age Mortgage Duration - Distribution by Age
Years 2007 2008 2009
Up to 10 3,6% 9,92% 6,85%
10 to 15 16,6% 8,24% 24,66%
16 to 20 24,3% 22,75% 31,5%
21 to 25 43,2% 23,97% 21,92%
26 to 30 12,3% 28,09% 9,59%
Over 30 - 7,03% 5,48%
About 8% of residential property in the country is
financed by mortgage debt.  Relatively low mortgage
indebtedness of the population is an indicator of
financial health of households and their ability to
adapt relatively painlessly to adverse external shocks.
2010 Mortgage Trends
In first quarter of 2010 we observe renewed activity
from banks now willing to resume financing of up to
80% of the selling price. A growth in the number of
transactions finalized with bank loans has also been
noticed.
Transacting the Sale - New Developments
In November 2009 the Bulgarian government voted to
change laws for notaries and notary activities, adding
European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 18 of 51
ERA BULGARIA
Varna, Bulgaria
Tel: +359 52 66 13 00
Fax: +359 52 66 13 15
info@erabulgaria.com
www.erabulgaria.com
statements requiring that all payments for real estate
transactions take place through a bank. The purpose of
the legislative change is to prevent the use of real estate
transactions for money laundering and to counter
problems concerning property fraud.
This new approach involves a complete transition to a
system of pecuniary transactions.  The law will
establish a state deposit insurance fund in which one
must enter and distribute all notary fees and taxes
related to notary acts.  Intentions are that it will not
compete with commercial banks and will not bear
interest. The fund will be sustained by a percentage fee
deducted from each transaction.
On second reading it was held that this rule for paying
via bank transfers will only apply  to properties
exceeding BGN 10.000. For transactions of lower
priced properties,  there will be no requirements on
how the payment should be done.  A new section will
be included in the deed, stating the exact price of the
transaction. It serves as a declaration, thus, each party/
signatory bears criminal  responsibility, if it is proven
that the amount paid varies from the declared
amount.  Penalties for falsely declaring transaction
prices can range from 1 to 6 years imprisonment and a
fine of 100 to 250 Leva.
2010 Outlook
There are two main factors that will determine the
state of the housing market in 2010 in Bulgaria: the
level of buyer income and the credit markets. In the
first months of 2010 we have already noticed the
activity of buyers with stable income engaging in
transactions through bank financing. In early 2010 two
groups of buyers were noticed. The first group of
buyers is between 25 and 30 years old, and has bought
their home with a mortgage. This group is even
inclined to withdraw a 100% financing.  Those in this
group often work in the sector of information
technologies, in banks or in private medical practices.
The second group consists of buyers of 40 to 50 years
that are investment minded.  The return of this partly
speculative interest is a good sign for the future of real
estate market, especially if it remains present over
time.  The number of Bulgarians working abroad and
buying property in Bulgaria is now very small. Interest
rates continue to follow a declining trend, which was
initially tracked in late 2009. We anticipate a further
reduction in rates of between 0,5 and 1%, while some
loans in BGN may decrease by as much as
1,5%.  Financing for properties will remain around 55
to 70% of the transaction price, a more liquid property
may reach 80%.  This still requires a minimum 20 to
45% down payment on behalf of buyers, a healthy
balance by any standard.
ERA Czech Republic
Residential prices decline nationwide, transactions stall in 2009; mortgage credit restrictions continue downward
pressure on demand expected to result in another challenging year for the residential market.
CZECH
REPUBLIC
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average
Days on
Market
2009 vs 2008 -21.85% -7.00% -8.38% -0.03% -4.12% -5.13% Buyer 36.84%
Trend 2010 Decrease Decrease Decrease Decrease Decrease Decrease Buyer Increase
European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 19 of 51
Price trends
In year 2009 ERA brokers in the Czech Republic
noted an average decrease of 7,3% in prices
throughout the country’s residential market. Year
2009 was the first decrease experienced after several
years of steady growth that began in 2005 when prices
rose consistently at a healthy pace of 8% annually.
This continuous trend of rising prices changed
direction in year 2009 because of effects linked to the
economic crisis and the fact that property prices began
to stray from their real value and affordability levels.
It is important to point out, once again, the utmost
importance of property location. In sites such as the
center of Prague and in the areas where employment
is more secure, house prices remained at the same
2008 level. The reason for this stability is that owners
of properties in such locations do not have the need to
reflect market trends and economic situations.
However, there were some other regions in the country
where prices dropped by over 30%. This occurred
mainly in areas where unemployment exceeded 15%
and in locations where the trend of increasing prices
rose to such high levels that people simply could not
afford to buy.
During the 2009 economic crisis Czech people learned
to negotiate the price of the property, a tool that will
eventually lead to stabilization of asking prices. It is a
natural process necessary for renewal of customer trust
in the real estate market and its indicators. In 2005 the
asking price and selling price were almost identical. In
some cases, the selling price was even a few percentage
points higher. In 2009 the selling price was 6% less on
average than the asking price (Czech Statistic Office).
Transactions
There was also a decline in residential mortgages in
2009 and this is one of the best indicators for tracing
the number of transactions. In 2009 banks approved
39.385 mortgages; this is almost 50% less compared to
2008 (Hypoindex). The chance of obtaining a loan
was at its lowest point, given tighter restrictions, often
including a requirement of over 40% down payment
to secure the mortgage.
Development of new residential properties, after
almost 15 years of continual growth, noted a radical
break in year 2009. The Czech Statistics Office states
the volume of new developments in 2009 was lower
than volume of completed development projects. This
occurred for the first time since the start of the 90´s.
Newly started development projects during the year
amounted to 37.319 units which is 14% less than in
2008. Completed developments were at 1.000 units
higher year-on-year.
Another factor contributing to the decrease in number
of transactions is the fact that purchases from property
speculators totally came to a halt. The motivation for
buying a property changed: motivation was now based
on the real needs of customers to own a residence at
an affordable price.
Outlook Autumn 2010 and beyond
Keys to the continued progress of real estate market
are now in the hands of the banks. The banks will also
determine the market of the basic home mortgages,
and that for loans to development companies. For a
home mortgage the buyer still needs to prove high
credibility and reliability; standards that almost 40% of
customers cannot show. To obtain a loan for a
development project one must to have a 30% personal
investment capital and the same percentage of pre-sold
units. These conditions are extremely difficult to reach
when most buyers will not consider investing in an
apartment unit of a developing project that is not
certain to ever be launched.
European Residential Real Estate Market Trends 2010
ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 20 of 51
ERA CZECH
REPUBLIC
Prague, Czech Republic
Tel: +420 224 83 59 51
info@era-reality.cz
www.era-reality.cz
In February 2010 the situation had not yet improved.
Bank institutions approved only 5.385 mortgages
during the first two months of 2010; this is 500 less
compared to the same months of 2008. However,
March is showing some signs of revival as banks
approved 50% more mortgages than in February 2010.
Lenders are focusing once again on their clients’ needs
by lowering mortgage rates which are now at their
lowest point since the start of the real estate crisis
(Association of mortgage Brokers).
Sales prices for second-hand properties reflected a
slight decrease of 0,90% during the first quarter of
2010, compared to the last quarter of 2009. Though
now, signs of an ever so slight increase in prices are
already being seen in second quarter of 2010. Based
on the research of Deloitte, a Hyposervis, not even
development companies expect any major price shifts
in the near future. Research states that developers
expect prices in 2010 to remain at the level of
approximately 89% of year 2008 prices and 92% of
2009 prices. Developers believe that in year 2010
prices will increase by 6% and in 2011 by another 3%.
If one is considering buying a property as a primary
residence then most observers will say there is no
reason to wait for further price reductions. However, if
buyers wish to purchase for investment purposes then
real estate experts do not have good news for these
types of buyers. Another boom, as experienced before
the crisis, will not be seen any time soon nor should
one expect prices to increase beyond the range of
10%, as was the case in 2007, for at least another two
years.
ERA France
Modest price corrections in 2009; Cautiously optimistic 2010 Outlook
FRANCE
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average
Days on
Market
2009 vs 2008 -9.08% -5.00% -7.17% -0.80% 0.00% -3.57% Buyer 19.54%
Trend 2010 Increase Increase Increase Unchanged Unchanged Decrease Buyer Unchanged
Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 21 of 51
General
Market contractions encountered in France during the
first semester of 2009 subsided during the second half
of the year resulting in a slight recovery; this trend has
been confirmed in the first quarter of 2010. Though
year-end market statistics show an average yearly
decline in both prices and transactions, trends also
reflected that larger city metropolis’ better resisted
these downward pressures. Media estimates of plunges
in the residential market were clearly less dramatic
than originally foreseen; nonetheless, results in 2009
could not rival the record transaction figures of 2007.
According to the Observatoire du Financement des Marchés
Résidentials more than half of buyers in 2009 were
under the age of 35, a sector of buyers that continues
to grow every year in both the new-home and re-sale
markets. The crises did not dampen their dreams for a
first time home. The foreign home buyer market
(topped by British, Italian, Belgian, and Portuguese,
followed by Dutch, Spanish and Tunisian) declined
during the year to 4%, compared to 5% in 2008,
representing a 20% decline.
Estimates by ERA France put the number of real
estate agencies currently operating on the market at
58.000 professionals, and about 27.000 real estate
agencies. Market share for real estate professionals is
estimated at 60% with average broker fees of 5,21%.
The average percentage of taxes per transaction is at
7%. Estimated number of days a property remains on
the market is about 104 days. The average size of a
home sold is 135 M2 and an average size apartment
sold is 64 M2.
Transactions
A total of 695.000 transactions were closed during
year 2009, of which 105.000 were new homes. New
home sales increased by 32% over 2008 when 79.400
transactions were recorded. Expansion of the new
home market is being largely sustained by the Scellier
program, a government initiative designed to aid new
homeowners enter the market, which is incentivized by
tax reductions. Of the 105.000 new home transactions
only 35.000 (33%) became homeowners, compared to
56% in 2008, largely shifting the buyer profile share to
the investors. This is was not in line with French
government objectives since the idea was to increase
homeownership and not investor driven purchases.
Resale transactions continued to decline, however
more modestly than anticipated in early in 2009.
Though there is relief at the more clear and positive
market trends seen during late 2009, the viability of
the housing market is still subject to the solvability and
morale of households (consumer sentiment), and shifts
in interest rates. According to a monthly market study
completed by the INSEE (March 2010) consumers are
pessimistic about their futures; particularly concerning
unemployment, inflation, and their capacity to save.
Though interest rates remain favorable, they question
for how much longer? Many uncertainties persisted at
the start of 2010.
Prices
According to data from the Notaires de France/INSEE, in
2009 the price of resale homes declined by 5,6% in the
Ile de France, and 3,5% in the Province for both
houses and apartments. In the Paris metropolitan area
the downswing was more pronounced: -7,5% for
houses and -4,5% for apartments. The average price
for a Parisian dwelling in 2009 was €6.208 per M2, 5%
less than in 2008.
Rankings for the more expensive regions in France
begins with Alpes Maritimes where an average home
costs around €400.000, and then Ile de France
€275.000, followed by les Bouches du Rhône
(€258.000). At the lower end of the market was Pas de
Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 22 of 51
ERA FRANCE
Versailles, France
Tel: +33 1 39 24 69 00
Fax: +33 1 39 24 69 01
info@erafrance.com
www.erafrance.com
Calais (€128.000), le Nord (€140.000) and the Loire-
Atlantique (€175.000).
Concerning the new home market, the Fédération des
Promoteurs Constructeurs, (Federation of Builders and
Developers) announced price increases nationally in
2009 of 4,2% in 2009 for new homes, however there
were regional disparities. Price declines were noted in
Pays de Loire, Corse, Bourgogne, and PACA, while
price hikes were seen in Basse-Normandie, Aquitaine,
Champagne-Ardenne, Picardie, Alsace and France-
Compté.
Mortgages
The average 15-year fixed rate mortgage was 3,6% in
2009, a 1% decrease over the 2008 average rate; this is
equivalent to a volume of 100 million Euro issued,
compared to 141 million Euro issued in 2008, or a
28% reduction in mortgage volume (Observatoire de
Production de Crédits Immobiliers). The Bank of France
states that during the first trimester of 2010 there was
strong demand for mortgages given the loosening of
lending criteria.
Outlook
2010 will be a year of positive transition and
stabilization for the residential real estate market in
France. There is no doubt that the effects of the
financial crisis on the housing market are still in play;
increasing unemployment (3,4 million in France), an
unpredictable economic situation, and a persistent and
low level consumer confidence combined with an
important decline of new starts in housing. On the
other hand, interest rates remain historically low and
there appears to be a softening of seller demands,
which further encourages a return of buyers to the
market. This might be best reflected in recent sales
figures from notaries in the Ile de France region stating
an 80% increase in transaction levels over 2007 peak
figures for the first quarter of 2010.
Average home prices are at €6.430; a 3,4% increase in
just three months for the Ile de France region. This
effectively erases the price declines of 2009. On a
national level the average home price was €201.000 in
the first quarter 2010, compared to €187.000 in 2008:
a 10% increase approximately. Listings on the market
dropped by 10% and an increase of 18% in the
volume of transactions closed has been recorded thus
far in (first quarter) 2010.
Lack of product on the market particularly in the
French Metropolis combined with overall strong
demand nationally, plus the increasing mobility of the
French and weakening dollar are all factors that will
help drive this market area to more positive and stable
territory.
ERA France is optimistic on perspectives for the 2010
home market.
ERA Germany
Stable home market for both prices and transactions, slight increases expected in both areas in 2010


GERMANY
N° of
Residential
Transactions
Avg. Home
Price/Capital
City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker Offices
Buyer or Seller
Market
Average Days
on Market
2009 vs 2008 1.00% 1.57% -3.15% -0.27% -5.26% -2.68% Buyer 5.11%
Trend 2010 Increase Decrease Decrease Decrease Decrease Decrease Buyer Decrease
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 23 of 51
Stable home market for both prices and transactions,
slight increases expected in both areas in 2010
Germany enjoys one of the most stable housing
markets in Europe. No extreme boom or bust scenarios
occurred in this residential market in recent years. This
largely contrasts the turmoil seen elsewhere in Europe.
General
Germany’s homeownership rate of 43% remains
unchanged, as in the last several years, and still lags far
behind the EU average of 62%. Germany therefore
remains a nation of renters. This, in fact, may be one
of the market stabilizing factors, making it less
vulnerable to supply/demand peaks and valleys,
especially when combined with its traditional,
conservative lending practices. Other stabilizing factors
include the low level of investment in residential real
estate at 5,5% of the GDP, and the government
emergency measures implemented in 2009 that helped
maintain relatively low unemployment levels, now at
7,5%.
According to the research institute Empirica, 37% of
Germans own houses and 6% own apartments. Of all
Germans, 46% live in rented properties and 8% live
with their parents. Recent trends show homeownership
differences between West Germany (47%) and East
Ger many ( 38%) are di mi ni s hi ng. Hi ghes t
homeownership rates are found in rural areas, as land
is far cheaper there compared to city plots. In rural
areas, 60% of people live in an owned house or
apartment while homeownership rates average about
25% in German cities.
Of current tenants 59% wish to buy property in the
future, but only 20% have concrete plans, and just 4%
want to buy within the next 2 to 3 years. Though many
Germans are able to afford buying property, as prices
are reasonable and interest rates are low, the trend is
stubbornly unchanged partly due to the highly
affordable rental rates.
Transactions
National real estate statistics are difficult to obtain in
Germany since this is generally managed on a regional
level. However, in 2009, for the first time ever, an
initiative was taken by a professional group of
valuation experts to seek cooperation from all German
regions to share real estate statistics and consolidate
information on a national level. Though the data
published in this April 2010 report includes all forms
of real estate, not just residential, there are indications
that residential transaction levels in 2008 mirrored
those of 2007 and that in 2009 had an increase in the
figures. The historically low level of interest rates on
mortgages are inciting buyers to invest now, since they
understand these low rates will not last forever.
Inflation concerns which may cause demand to spike
(thus prices to rise) are also motivating buyers to invest
now. Nevertheless, transaction levels have and will
remain relatively flat due to the consistency in buyer
and seller motivations, which include: increase in
family size, death, divorce, relocation and scaling up or
down in property size.
Prices
As stated above if there are no market exaggerations
no bubbles can explode. This describes the German
real estate market best. Home prices in Germany were,
and still remain, very stable. Germany seems to be the
only country in the EU that did not demonstrate
pricing excesses and therefore experienced no
significant price corrections.
Price variations can be seen, however, when comparing
newly built homes with second-hand homes and when
comparing rural with urban areas. Prices in city
centers as well as in metropolitan areas edged slightly
upwards by 1% to 2% due to the influx of people to
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 24 of 51
ERA GERMANY
Duesseldorf, Germany
Tel: +49 211 440 37 680
Fax: +49 211 440 37 689
info@eradeustchland.de
www.eradeustchland.de
inner city districts and tight supply as the pace of new
developments remains slow in these areas. On the
other hand, prices for apartments and houses in
smaller cities and rural areas edged downward.
Berlin’s market proves to be panic-proof. Prices per M2
for apartments increased on an average of 2,8% (to
€1.612 per M2) compared to 2008, while apartment
buildings increased by 0,4% (to € 1.066 per M2).
However, more recent indications are that house prices
in this capital city may slide back by a few points in
2010.
Mortgages
Mortgages are at historically low rates, ranging from
3,5% to 4,2%. In mid-June the ECB pegs the average
variable rate mortgage at 3,73%. Therefore financial
options for clients are improved compared a year or
two ago. Banks are also prepared to finance private
buyers who have 20% equity. The majority of these
mortgages are closed at 10 to 15 year fixed rates
because of the favorable conditions.
Outlook
The residential housing sector is, again, expected to
remain relatively stable. However, market observations
thus far for 2010 show a strong upswing in demand to
nearly double that of 2009. Continued historically low
interest rates, inflation fears, and loss of trust in the
financial (stock) market appear to be driving this
demand. Paradoxically, there is lack of supply right
now, as sellers are uncertain how to reinvest their funds
once their property is sold. As home values are
considered more-or-less assured, sellers are choosing to
stay put for now, until the situation becomes clearer.
Future trends are for buyers to move toward the more
affluent suburbs near larger city centers, where there is
good infrastructure, retail shops, meadows and
greenery. The elder population will be an important
sector of buyers taking part in this trend as they sell
their rural estates and move to the greater comfort and
convenience of a city center. As a result, prices are
expected to increase in these areas. If we compare
2008 to 2009 second semester figures prices increased
in eight German cities, the most dramatic increase
being Berlin +4,5% (to €2.100€ per M2), followed by
Hamburg +3,8% (to € 2,750 per M2) and Düsseldorf
+3,5% (to €2.330 per M2).
Germany in effect has two distinct markets. The
dividing line is no longer between East and West
Germany, but between rural and urban areas. There
are often large price disparities within city centers as
well. Home buyers seek a sound and safe investment in
housing with reliable returns compared to what is
viewed as the more volatile financial markets, and
uncertainties present today in the Euro zone derived
from unprecedented deficit financing.
ERA Greece
Sharp fall in transactions and decline in prices, although real estate is expected to maintain its fundamental value,
stabilization not expected before 2013

GREECE
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average
Days on
Market
2009 vs 2008 -27.08% -5.00% -3,40% 0,25 N/A N/A Buyer N/A
Trend 2010 Decrease Decrease Decrease Increase Decrease Decrease Buyer Increase
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 25 of 51
General Economic outlook
Under the burden of heavy fiscal imbalances, Greece
had to seek international assistance in April 2010.
Under the joint IMF-EU Agreement, Government
debt is expected to climb to 150% of GDP by 2013
before beginning to fall. The austerity measures
promised during negotiations that led to the
Agreement will put further pressure on an economy
which is already in recession. Although forecasts
concerning the level of GDP reduction and increase in
unemployment rates greatly vary, there is little doubt
that both these indicators, critical for Real Estate
market performance, will fare worse than hitherto
expected.
The generalized insecurity and fear of a State default
that preceded the international bailout led to a
localized collapse in real estate transaction numbers
over a few short months. Consumer sentiment
deteriorated quickly, as both State finances and the
economic outlook for the coming years worsened. This
process will undoubtedly take some time to fully
resolve, a fact that is expected to be reflected for some
time in residential sales.

Transactions
The number of transactions peaked in 2005, shortly
before the new VAT regime was imposed (2006), at
215.148. On average about 160-170.000 properties
changed hands each year in Greece, something that
was confirmed by published Bank of Greece Statistics
for 2006-2008. The latter year saw the peak of the
relevant house price index, which started to decline
with the credit crunch that followed the collapse of
Lehman Bros in September 2008. In the months that
followed the fated event, Greek banks severely reduced
the flow of funds to all economic activity and gave
specific instructions to appraisers to lower their
estimates of property prices. Last year, 2009, was the
worse year in decades with transactions falling below
the 100.000 mark: only 94.801 transactions took place
in 2009 according to Bank of Greece data. Prices also
declined from their nominal peak in 2008, albeit
slightly, in the area of 10% for metropolitan Athens
and slightly higher in other areas.
 
Prices
According to the Bank of Greece (BoG) residential
property prices continued drifting downwards in 2009
for all dwellings and in all areas. Contrarily, property
rentals rates have increased, though at a diminished
pace.  For 2009 the most important YOY price drops
for 2009 were recorded in  Thessaloniki  at 6,2%
followed by Athens at 5,0% for both apartments and
dwellings. All urban areas combined recorded a
decline of 3,4%. BoG estimates tend to be on the
conservative side. Several areas have experienced
double digit drops, although this also has to do with
the movement of populations to newly built areas or
away from inner city quarters now rapidly re-
populated by economic immigrants.
 
Mortgages
A substantial decline in the value of residential real
estate transactions closed was recorded in 2009.
According to the BoG-Eurosystem real estate market
analysis for 2009, the number residential property
transactions involving a mortgage lending institution
declined by 39,6%, the equivalent value of those
transactions declined by 42,1%.  These are significant
YOY declines under any circumstances. Both of these
statistics concern sales involving a mortgage institution
and not cash sales. Furthermore, a decline of 41,2% in
the overall volume of square meters was recorded;
therefore smaller size properties are selling. According
to the BoG, interest rates in March 2010 for a variable
rate housing loan or an initial fixed rate one-year loan,
increased by 13 basis points to 3,21%. Fixed rate loans
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 26 of 51
ERA GREECE
Athens, Greece
Tel: +30 210 322 2254
Fax: +30 210 322 2257
info@eragreece.com
www.eragreece.com
from one to five years increased by 12 basis points to
an average of 4,79%. The true problem though is the
reluctance of the banking sector to give loans to
anyone but the most credit-worthy candidates, who
also must place a large down payment.
Outlook 2010
Mortgage lending is expected to tighten with further
restrictions on new lending being imposed. Under the
International Economic Control agreements,
additional taxes are expected to be levied on property.
This is already escalating the number of properties on
the market, as owners of large property portfolios seek
to liquidate their positions to avoid a heightened tax
burden and/or anticipated price declines. Depending
on the willingness of banks to lend, we estimate
45-80.000 transactions for the year. Falling in this
range is an estimate of about 50.000 sales nationwide
which was published in the daily press.
The sellers’ resistance to lower the prices is expected to
be somewhat dampened by increased unemployment
rate and the deepening recession. We already have a
steady stream of people seeking to sell in order to
alleviate the consequences of losing a job or closing
their business.
2010 will be another buyers market with some
spectacular opportunities materializing, buys that were
unimaginable just a few years ago. Overall however,
real estate is expected to fare better than other more
exposed sectors of the economy where sales have
collapsed. The anticipated price movements will occur
in different degrees depending on local parameters.
Although it may sound like little solace, real estate will
retain its intrinsic value.
Special thanks for report preparation to:
Dr. Kosmas Theodorides, Broker – Owner
ERA Polis – ERA Acropolis
ERA Ireland
Further declines in both prices and transactions, though pace slowing thus far in 2010 with regional disparities.


IRELAND
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average
Days on
Market
2009 vs 2008 -42.46% -25.75% -20.95% 1.05% N/A N/A Buyer 24.22%
Trend 2010 Decrease Decrease Decrease Increase Decrease Decrease Buyer Increase
A recent survey of ERA Estate Agents across Ireland shows up some interesting residential property
price trends.
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 27 of 51
"It is unhelpful to speak of average property market
prices as if there were just one national residential
property market. The ERA Ireland survey which is
representative of forty urban and rural markets in all
counties in Ireland has thrown up some interesting
variations" says Frank Doonan CEO of ERA Ireland.

Generally where demand exists at present it is for three
and four bedroom second hand homes, in or adjacent
to population centers with good local services. This
reflects the fact that first time buyers with secure
employment is the sector most likely to secure
mortgage financing from the main Irish banks at
present.

There are several locations in Ireland where there is
less oversupply of good quality starter homes and
therefore property prices have stabilized faster in these
areas. Price drops in this new home sector, range from
-33% to -50% and an average decline off peak* of
40%.

Apartments in secondary locations are the least sought
after property type at present. Many previous buyers of
such apartments can now afford to buy a two or three
bedroom house in the area of their choice. For the
moment, this trend change will lead to a reduction in
the number of moves a person makes in their early life
stage. Apartment living for many first time buyers was
generally seen as a necessary starter property before
moving on to a family home. This was especially true
in the main urban areas. Because of the density of
apartment developments many areas have gross
oversupply relative to demand. Price drops in the
apartment sector range from -33% to -60% and an
average decline off peak of 46%

One off properties in the country, commonly referred
to as the 'bungalow on the half acre' have dropped in
price within a range of -27% to -45% with an average
price drop off peak 2006 prices of 37%.

Apartments in provincial towns with significant
oversupply are reported at -60% off peak and
demonstrate the largest price decrease in the ERA
Ireland report.

Suburban bungalows on their own site have suffered
smallest price decreases with some areas reporting a
27% price decrease from peak.

The lesson to be learned for property sellers and
buyers alike is to think local when valuing an
individual property.
Your local ERA estate agent with local knowledge and
national marketing capability will help you wade
through all the factors influencing the price you should
guide your house for sale.
* For the purposes of this survey property prices peaked in
Ireland in autumn 2006.
Transactions
The most reliable method of tracking property
transaction numbers can be observed from the Irish
Banking Federation (IBF) quarterly report on
residential mortgage drawdowns.

A total of 45,818 residential mortgages were drawn
down in 2009, 42,46% fewer than in 2008. In quarter
four of 2009, 9.946 mortgages were drawn down
which was 18.4% fewer than in the third quarter; so
the decrease in mortgage lending continues. The first
time buyer sector experienced the lowest decline in the
fourth quarter of 2009 with 3,4% fewer mortgages
when compared with the previous quarter.
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 28 of 51
ERA IRELAND
Dublin, Ireland
Tel: +353 1 89 01 722
Fax: +353 1 89 01 723
info@eraireland.com
www.eraireland.com

Mortgage loans totaling € 8.076 million were issued in
2009, 65% less than in 2008.

First time buyer average loan volume peaked in
quarter one of 2008 at €251.831 and has dropped to
€206.865 in quarter four of 2009.

Due to the crash in Irish property prices the Irish
banking sector is in deep distress with the Irish
government having to guarantee all banking activity
and relieve the major banks of billions of toxic loans
lent into the sector throughout the Celtic tiger property
price bubble. This is being managed by the newly
created National Asset Management Agency (NAMA).

Irish tax payers now foot the bill for massive developer
loan write offs and the Irish government is forced to
recapitalize the banking sector on taxpayers’ behalf.
There is hope that as property prices bottom out at
roughly 50% off peak, and the recapitalized banks get
back to prudent lending to the sector, we will begin to
see residential property transaction levels rebound
during 2011.
Outlook Autumn 2010 and beyond
Asking prices for properties across Ireland have
continued to fall; however, the rate of decrease in
asking prices has eased for the second successive
quarter. The most notable exception was Dublin City
South where the average asking price rose by 1.1%.
Asking prices nationally fell by 3.3% in the first quarter
of 2010 compared to a fall of -3.5% in the last quarter
of 2009. In Dublin asking prices fell by 3.9% in the
first quarter of 2010 bringing the total fall over the last
12 months to 15,2%. Asking prices in the capital have
now fallen by 33.4% since their peak in 2006. New
homes recorded the largest drop in asking prices in
quarter one, declining by 4.4%. This was the largest
decrease on any of the MyHome.ie property
barometer indices. The asking prices for second hand
homes fell by 3,2%, the smallest decrease in percentage
of any sector covered. Actual sales prices have on
average decreased by 40%+ since peak in 2006.
Commenting on the results, independent economist
Paul Murgatroyd said the -3,3% rate of decrease in
quarter one was significantly lower than the -6,13%
recorded over the same period in 2009. “Asking prices
have continued to fall as have actual sales with plentiful
anecdotal evidence showing peak to trough declines in
sales prices in the order of 40 to 50% depending on
property type and location. “There has been a three
fold increase in sale agreed properties in Dublin
compared to the same period last year, which is
encouraging.

It is also interesting to note that three quarters of first
time buyers are looking to purchase a second hand
property while one in five is seeking a newly built
home. Nearly half of the first time buyers have a
preference for a semi-detached home while 10% prefer
an apartment. Source: myhome.ie
ERA Italy
Demand remains week, home values decline 4,1% nationally in 2009, no signs of price growth in the short term


 
ITALY
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average
Days on
Market
2009 vs 2008 -11.28% -4.10% N/A -1.20% -7.41% -9.52% Buyer 72.5%
Trend 2010 Decrease Decrease not available Decrease Decrease Decrease Buyer Increase
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • 1 June 2010 • Page 29 of 51
General
The deep global economic, financial and real estate
crisis that began in mid 2007 seems to have bottomed
out for Italy during the first half of 2009. After the
economic difficulties experienced between September
2008 and April 2009, 2010 is showing slight
indications of a comeback.
Compared to other countries such as the United States
and Spain, the economic crisis has been relatively
contained in Italy and more connected to the macro-
economic weakness of the country as opposed to the
so-called housing bubble. If the economies of
countries such as the US, Spain and the UK were
weakened as a result of financial problems originating
in the real estate sector, the opposite can be said for
Italy, where the weakness of the macro-economic
situation was the principle factor in the deterioration of
the real estate market, in part due to a decrease in the
quantity of transactions as opposed to prices.
Prices and Transactions
The volume of investment in construction fell 9,4% in
2009, dropping to €143 billion after having peaked in
2007 at more than €152 billion. Meanwhile, the total
value of real estate transactions between 2008 and
2009 decreased by 18,1%, a loss of € 24 billion,
dropping to a total of €109 billion.
From the end of 2006 when the market was at
maximum expansion to today, the total number of real
estate transactions has dropped 21,2%, from 1,709,176
to 1,347,368. Real estate values including home
prices, began declining during the second half of 2008
in tandem with the fall of Lehman Brothers, at which
time there was also an increase in yield.
In recent months however, it has been noted that
global macro-economic trends seem to be heading in a
positive direction. Although values still remain much
lower than a few years ago, some countries are already
showing clear signs of recovery with consistent
increases in volume as well as in prices in significant
sectors of the European real estate market. The effects
of the improved real estate market overview are still
rather weak in Italy. In some countries where prices
dropped, the demand has al ready returned
significantly, whereas in Italy the demand remains
weak and prices are not yet showing signs of growth.
Research firm, Nomisa’s last market survey of the 13
largest Italian cities revealed a negative variation of
4,1% in the average price of a home in 2009. The last
semester indicated a slowdown in the pace of decrease
in prices that could be indicative of a comeback.
Data regarding these positive market trends has been
confirmed in a preliminary survey held in March 2010,
by a panel of real estate experts from the 13 main
cities. They agree that house prices are not rising due
to the fact that supply still largely exceeds the level of
demand, as was the case during the final semester of
2009. Therefore, in 2010 prices still appear to be
declining, albeit in a limited manner.
The data regarding the abundant supply and the
scarce demand shows however, an active market for the
following categories:
- Dwellings in energy efficient buildings that are well
situated and that offer parking, services, green space,
etc.
- Dwellings in prestigious buildings in prestigious
locations, in the city centre or in buildings with a high
architectural quality
- Dwellings in prestigious tourist locations with strong
appeal
On the other hand, the market is particularly weak if
not completely absent for:
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • 1 June 2010 • Page 30 of 51
ERA ITALY
Milan, Italy
Tel: +39 02 393 59 491
Fax: +39 02 393 59 441
info@eraitaly.com
www.eraitaly.com
- Low quality dwellings normally in buildings poorly
situated and in the outskirts
- Buildings located in not particularly prestigious
tourist areas in a poor environment
- Devel opment s wi t h l ow archi t ect ural and
construction quality and low energy efficiency
Mortgages
In 2009, the important drop in interest rates for new
mortgages helped sustain the demand for dwellings.
The typical average monthly mortgage payment fell by
15%, from €821 to €704 per month, returning to well
under pre-crisis average amounts. Lower mortgages
rates in 2009 however, were not enough to sustain the
total number of mortgages closed during the year;
these actually decreased by 10,7%, from 271.000 in
2008 to 242.000 in 2009. Of the 609.000 homes
bought in 2009, only 205.000 were purchased with a
mortgage and at an average value of just under
€130.000.
ERA Luxembourg
Transactions down by 17%, home values drop nationally by 10,6%, signs of recovery on the 2010 horizon

LUXEM-
BOURG
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average
Days on
Market
2009 vs 2008 -17.80% -10.29% -10.66% 0.70% -7.69% -12.50% Buyer 16.67%
Trend 2010 Decrease Unchanged Unchanged Unchanged Decreased Decreased Buyer Increased
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 31 of 51
General
Homeownership is slowly reversing course and moving
downwards in Luxembourg. Once averaging 72%
today homeownership is estimated at 67%, due to the
ongoing difficult economic situation. Nevertheless, the
rate remains comparatively higher than in neighboring
European countries. As financing becomes more
difficult to access, demand for apartments or smaller
properties has increased; conversely the desire for
higher priced areas and/or homes has waned.
Population tendencies are increasingly toward moving
to urban areas, due to the high concentration of jobs,
work facilities and/or general opportunities the city
cent er of f ers. Today, access t o conveni ent
transportation and the ease of getting to and from
work have a significant impact on the choices people
make on where to work and live.
Prices and Transactions
Transactions, as well as real prices paid by home
buyers fell from 2007 to 2009, though demand for
homes remain high. People who cannot afford buying
at still relatively high prices opt now for renting
solutions. Though many sellers are still slow to adjust
prices downward, a truly motivated seller will in the
end sell at market value. Buyers simply will not
purchase at asking prices they feel are over valued nor
will banks finance these properties.
So, there is a clear difference between asking prices
and the end price paid at the notary. This pricing
disparity has also had a negative impact on
transactions figures that have dramatically fallen these
last 2 years. As long as the Government of
Luxembourg Government continues to provide
statistics that make buyers feel that the market is
overpriced, many buyers will not feel comfortable in
buying. Unfortunately the Government publishes
figures, mixing asking price statistics and the real prices
paid to the notaries, thereby confusing the public. The
only reason that might explain this approach is that the
Government has its own real estate projects to sell.
These programs have a clear social purpose, and they
sell poorly. So propagating the image of a real estate
market that is overpriced (I.e. too expensive), allows the
Government to present a better price/quality ratio.
Real Estate Offices
There was most likely some attrition in the number of
real estate offices last year, but there are still a high
number of agencies and agents on the market to sell
the properties offered on the market.
Mortgages
Though local retail banks are offering mortgage loans
at historically low interest rates, loans are still difficult
to obtain if the buyer does not have a significant down
payment. On average a 25% minimum down payment
is required together with and a good salary and
employment history. Fixed rates are not typically used
in Luxembourg, but due to the low interest rates, and
the need for buyers who dare to buy now (and it’s the
best time to buy now) for security in the future, as a
result many more banks now offer attractive fixed rate
loans for periods up to 20 years.
Outlook 2010
The market clearly experienced a slow down between
2007 and 2009, however now we are seeing signs of a
recovery. Demand remains healthy, especially given the
constant need for homes and the fact that many
investors choose real estate as an alternative to banks
and/or stock market investments. With a more
regulated real estate market, buyers are reassured in
transacting real estate, but remain concerned about
valuations. With an uncertainty about the future
buyers remain conservative and will only pay real
market value and no goodwill.
Second-hand homes sell better and faster than new
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 32 of 51
ERA LUXEMBOURG
Luxembourg
Tel: +352 40 38 981
Fax: +352 40 37 9750
info@eraluxembourg.com
www.eraluxembourg.com
properties, as the latter are comparatively higher
priced. Most developers are having serious problems to
lower their prices, because their purchase costs were
much too high and in doing so would lose money.
2010 will bring an increase in real estate investments
(and home rentals) with a tendency toward a stabilizing
market after the serious market corrections during
2008 and 2009.
ERA Netherlands
A search for new balance in the Dutch housing market


Netherlands
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average
Days on
Market
2009 vs 2008 -30.08% -6.69% -7.41% -0.60% -44.44% -33.33% Buyer 37.18%
Trend 2010 Decrease Decrease Decrease Decreased Decreased Decreased Buyer Increase
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 33 of 51
During the last quarter of 2008 the real estate market
changed in the Netherlands. That was when the
housing market seemed to almost reach a complete
standstill overnight. Everyone held their breath: sellers,
who needed to sell their homes, were wondering how
much they would have to lower their asking price. The
real estate agents were agonizing how long this total
lack of showings and sales would last, and how long
they would last during this situation. Homebuyers were
waiting for the economy to recover, and did nothing in
the meantime. Banks were in dire need of government
support to survive their own internal crises. Financing
homes was definitely not their top priority. Hence,
buying a home was not an easy thing to do neither
during this quarter nor during the early months of
2009.
The government realized that it had to act. They were
missing 6% on every transaction on taxes and they
needed the tax income. They had to make sure that
homebuyers would get some sort of compensation for
the risk they were taking when buying a home.
Therefore they stretched the criteria for a mortgage
guarantee, the NHG (Dutch Mortgage Guarantee
Fund). That made buying a home up to €350.000 less
risky for banks. Consumers would get a discount on
their mortgage rate in return. Furthermore, the
government would subsidize homebuyers in the lower
segments. During the years before the crisis young
newcomers in the market without capital had almost
no chance at all to afford and finance a home. One of
the symptoms of the economic crisis was a huge listing
inventory and a subsequent sharp decrease in home
prices. Combined with the buying subsidy this would
be a golden opportunity for newcomers to finally be
able to buy their first home. Unfortunately banks were
not very keen on supplying mortgages, while they were
still working on their internal troubles. Therefore this
opportunity was not the huge dreamed of success.
During the year the Dutch market showed an unstable
pattern of occasional recovery and relapse into inertia.
The real estate offices have had to downsize as much as
they could. Offices nowadays are often half the size in
man power compared to their size before the crisis.
Listing inventories have doubled, in most cases. There
is a contrast between older and recent inventory. A
section of a real estate office’s inventory was listed
quite a while ago for asking prices which today are no
longer realistic, and hence do not attract any attention
from homebuyers. There is only one option for these
homes: lower their price until homebuyers do respond.
Due to the over-financing in the past, a certain number
of these sellers are faced with a huge debt, should they
sell their home for a realistic amount. These people are
neither willing nor able to lower their asking price.
However a buyer does not care what amount of money
the seller needs. He just wants to pay the lowest
possible price for a home.
More recent listings sell faster and are less difficult
because of a more realistic asking price. The average
transaction numbers do not say much. In some regions
the number of transactions seemed to increase
gradually, until April of this year. At that point in time,
the Dutch government collapsed. A new parliament
will be elected in June of 2010. Due to the economic
stagnation, heavy cuts on government expenses will be
necessary. The allegedly fixed in stone tax deduction
amenity for paid interest on home mortgages, for many
people their stepping stone to owning their home, has
come under siege. That has created huge uncertainties
with potential homebuyers. Again, showings have
decreased severely. People are waiting to see what the
elections in June might bring. Until then they are quite
reluctant to buy a home with the risk of not being able
to afford it.
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 34 of 51
ERA NETHERLANDS
Utrecht, The Netherlands
Tel: +31 30 289 9900
Fax: +31 30 287 1109
era@era.nl
www.era.nl
Outlook
The real estate market in 2010 will remain volatile, as
a result of local political and economic instability. Price
corrections will remain necessary for older listings, if
they cannot be retracted from the market.
ERA Portugal
New building activity at its lowest point in 15 years, transactions and prices down, 2010 pace more positive


PORTUGAL
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average
Days on
Market
2009 vs 2008 -13.59% -24.00% -4.35% -2.00% -1.26% -1.26% Buyer -11.11%
Trend 2010 Decrease Decrease Unchanged Decrease Decrease Decrease Buyer Decrease
European Residential Real Estate Market Perspectives 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 35 of 51
General
The Portuguese economy slowed in 2009 a shift that
began toward the end of 2006 in other main European
economies. The 2008 financial crisis further
exacerbated this trend and has contributed to a more
severe retraction of the economy in 2009.
Due to its high degree of exposure and indebtedness
level, the economy was adversely affected, this was
reflected in a GDP decrease of 2,5% in 2009 (after a
0,3% growth in 2008). As a result of convergence of
this international financial crisis with general global
economic woes, structural economic weaknesses were
exposed within the country. The crisis also had a
negative impact on Portuguese families’ income and
wealth, as well as their future expectations, resulting in
a hastening of both investment and consumption. By
the end of 2009 there were nearly 500,000
unemployed people, or a 10% unemployment rate.
Main indicators of Portuguese real estate market in
2009 show a downward correction in supply that had
already commenced in 2003; and a deceleration as
well in demand. Construction licenses issued in the
residential sector reached a total of 45,400
representing a 30% decrease versus 2008. In year 2009
there was an additional reduction of 21% in approved
construction licenses.
Transactions
Concerning the number of properties sold in Portugal,
a decrease was verified in 2008 compared to 2007. The
Portuguese official source (INE), states in 2008 the
number of properties sold in Portugal declined by
18%, meaning 37,000 properties less sold in the
Portuguese market. Despite the lack of official figures
for 2009, market specialists estimate an additional
reduction of 14,000 properties sold (meaning roughly
150,000 properties sold in 2009).
The percentage of decline was not uniform over the
entire nation. Regions where residential construction
associated with tourism were most dense such as
Madeira Autonomous Region and South of the
continental territory (Alentejo and Algarve) were the
regions contributing most to the decline. Historically
attractive to British investors, the Algarve region
suffered particularly from the pound devaluation
versus the euro currency (roughly 30% devaluation
since the start of 2008). Data relating to new build
activity is at its lowest levels in the past 15 years.  
Prices
Unlike in other European countries, the speculative
bubble in real estate was not strongly noticed in
Portugal, although a growing supply versus demand
adjustment was verified during the last year, with a
slight average price decrease in 2009 (-2,6% versus
2008). A slight negative growth rate of square meter
(m2) average price in housing in 2009 was verified in
most of the quarters along the year (- 0.3% in Q1,
+1.7% in Q2, - 0,3% in Q3, - 0,9% in Q4). The
current situation offers very attractive buying and
investment opportunities in 2010. 
Mortgages
With the Euribor currently at 1% (and average spreads
of 1, 5% for new mortgages), the average interest rate
for Portuguese families in 2009 was roughly 3%.
Buyers are experiencing greater difficulties in obtaining
mortgages as restrictions are tighter and loan to values
i nc r e a s e d, f r o m a n ave r a g e o f 9 0 % t o
80%.  Mortgaged loans issued declined 31% in 2009
versus 2008 (from € 13,526 million in 2008 to €9,330
million in 2009). The 1st  semester 2009 reflected
declines across the board with the largest fall occurring
in the 1st  quarter. A reversal of this trend began in
June.  By the end of the year mortgage loans continued
an upward growth trend. 
European Residential Real Estate Market Perspectives 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 36 of 51
ERA PORTUGAL
Lisbon, Portugal
Tel: + 351 213 600 150
Fax: +351 213 600 159
info@era.pt
www.era.pt
The indebtedness of the Portuguese families has
reached a historic maximum of 134% of the total
available income.
Outlook 2010
Despite the decline in construction licenses issued and
in completed conventional dwellings, the residential
stock will remain high as there continues to be
persistently weak demand.  
Tighter restrictions on mortgage lending practices due
to a growing risk of non-payment issues, increased
demand for housing in the rental market. The
convergence of three factors (low interest rates,
downward adjustment of sales prices and more fierce
competition from the financial institutions) may
however in the short terms lead to a recovery, although
not yet sustainable, of the buying and selling process. 
An important factor that still needs to be clarified is the
impact on interest rate spreads (given by banks to
property buyers), after the rating agencies’ (Standard &
Poor’s, Moody's Investor Service and Fitch Ratings)
gave recent negative assessments of the financial risk of
the Portuguese economy. The higher the risk
perception of the Portuguese economy, the more
expensive the Portuguese banks will have to pay for
their funding operations in other markets. And, the
higher price Portuguese banks will pay to obtain credit
abroad, the more they will have to increase the spreads
of mortgages approved to people willing to purchase a
house in Portugal.
This clearly has potential to have a further negative
influence on an already fragile housing market.
Trends
- Growing level of real estate industry market share,
due to the sector higher professionalism and the
private clients’ growing need to search the real estate
services to sell their houses.  
- Consolidation of real estate businesses into main real
estate networks.
- Recovery of residential market growth, in
transactions and mortgage loans, at a slower and
more selective rhythm.
- Increase in quality of delivery of new services by real
estate agencies, in light of demand from new market
segments including the senior market and individuals
living alone (including divorced people).    
- Real estate product differentiation based on factors
such as location, construction quality, architecture,
design and environmental efficiency.
- Growth in higher quality project developments of
resorts, golf courses and SPA’s (Algarve, Setubal
peninsula, Alentejo and West sea coast), to continue
to attract residential tourism, and the senior
residential market.
- Urban rehabilitation: implementation of public space
improvement and historic centers.
ERA Romania
Prices drop by 19% on average, -28% drop in transactions, 2009 was a year of market corrections and stricter
mortgage requirements; 2010 shows a continued downward price trend.


ROMANIA
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average
Days on
Market
2009 vs 2008 -27.18% -16.67% N/A 0.60% N/A N/A Buyer 0.0%
Trend 2010 Decrease Decrease Decrease Increase N/A N/A Buyer Unchanged
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 37 of 51
General
The Romanian residential market is characterized by
relatively high number of homeowners (97%).
Demand for residential property comes mainly from
the new upper class, middle class and foreign investors,
targeting middle to high quality offers, which are
difficult to find in the market. The quality of the
housing stock is very low throughout the country.
According to statistics its volume is estimated at about
8.270.000 flats and houses, which roughly translates to
384 units per 1.000 inhabitants.
Nearly 55% of Romania’s housing stock is located in
urban areas, and most of it represents blocks of flats
made of prefabricated concrete slabs built in the
socialist era. In 2008, 52,8% of the delivered dwellings
were built in the rural areas. In 2009 around 52% of
the units were delivered in the cities, while the
remaining 48% were built in the rural areas.
The number of housing units delivered in the first six
months of 2009 went up by 1.248 units against the first
six months of 2008, reaching 23.000 dwellings,
according to the National Statistics Institute (INS). At
the end of Q3 2009, developers still declared their
readiness to deliver a record-breaking number of more
than 3.000 units in Bucharest in 2009. Compared to
2008 situation, market conditions have been slowly
stabilizing from a developer’s point of view. A good
signal is the clearly reduced number of available stock
of unsold apartments, though the price reductions
have not resulted in a satisfactory pick up in sales as
expected by developers.
Competition in the residential construction market is
getting tougher, with larger projects and more offers,
but fewer buyers. The market for smaller residential
projects and re-sale property is governed by mid to
small-size real estate agencies. As many as 15.700
companies were engaged in real estate activities in
Romania at the start of 2008 in addition to the leading
top-20 companies. However, out of this number, only
1.700 had real estate as their main business activity.
From these 1.700 real estate agencies, only 125
generated more than € 10.000 in turnover and had
more than four employees. With the decrease in the
number of transactions many small real estate agencies
withdrew from the real estate market; some of them
for good while others intend to so only temporarily.
Prices
After the spectacular price growth in 2007 and
stabilization in 2008, the year 2009 saw a visible price
correction downward. The average asking price of
residential space in Bucharest came to a net of
approximately of € 1.260 per M2 of built area. This is
15% less on average, compared to the third quarter of
2008. The level of price correction in real prices does
not seem extremely high, if we look at the Euro prices
during that period of time. The appreciation of this
currency versus the RON can be estimated at 18,5%
(30 Oct 2009 / 30 Oct 2008). As prices are quoted in
Euros, the price correction was partially consumed by
the currency fluctuations. The prices of currently listed
new dwellings generally range between € 900 and
€1.200 per M2, with approximately 60% of the entire
supply below the market average.
In reality, not all residential prices experienced a drop
in Bucharest. The decrease in prices was mostly
noticed in flats located in the old communist buildings
and in certain locations far from the central Bucharest.
Investment fear persists though, primarily due to bad
media and tighter bank polices for mortgages.
The 2009 end of year analysis shows reduction in
prices of new apartments by 19%, comparable to the
price decrease registered for second-hand units which
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 38 of 51
was 20%. The average price for a new dwellings closed
the year at €1.300 per M2 (without VAT), a 19% drop
from December 2008 levels.
The prices for apartments targeting the medium and
upper-medium segments of the market varied between
€1.100 and €1.500 per M2, with apartments located in
peripheral areas at the lower end of this range. A
higher price level of between €1.500 and €1.700 per
M2 was requested for projects located in secondary
areas, as they benefited from several competitive
advantages compared with the ones listed at a price
lower than €1.500 per M2 .
Most developers preferred to maintain high asking
prices, but were flexible when negotiating with clients.
Therefore, the effective price for a closed transaction
may be 10 to 15% less. Moreover, developers offer a
variety of incentives such as: fully furnished and
equipped kitchens, parking spaces, storage rooms or
discounts for a limited number of units. Developers
also had flexibility when it came to pricing of their
units, as they could personalize offers according to
each client's payment capacity. Consequently, the price
decrease doubled when allowing for adaptations, such
as renting the apartment with an option to buy at a
later point in time or offering alternative payment
methods to temporarily avoid bank financing.
Price policies were not uniform; some developers/
investors maintained the same price levels in 2009 or
just slightly decreased them with no more than 10%,
compared to 2008. Even in the context of a very slow
selling rhythm, developers opted to maintain a stable
pricing policy for projects with attractive price/quality
ratios or that were located in prime residential areas.
Additionally, the constant price level was determined
by several other factors: the contracts signed with
banks for the project financing, low competition
between projects located in central and secondary
areas, pressure from clients who had already purchased
properties at a higher price within the same complex.
In some cases price decreases were spurred by the
competition between developers and the investors who
purchased apartments off-plan during 2007-2008 and
later offered them for sale. Still, as the market does not
allow for expected profit margins at this time, investors
prefer to rent the apartments until a future market
recovery.
Hot Spots
The city of Bucharest attracts most of the investors,
while the other cities remain quite ‘undiscovered’.
According to the estimates, Bucharest may double its
population in the next 10 to 15 years to over 4 million
inhabitants. Attractive working opportunities created
by Romanians and foreign investors who launch
businesses in Bucharest will attract an increasing
number of people to the capital city.
In Bucharest, price levels are permanently ahead of
other big cities, thus, the residential market in
Bucharest also dictates price drops. The average price
continued to decrease in Bucharest for both new
houses and older flats in 2010. The price per M2 of
used area in Bucharest (IMO index) registered in
March 2010 was 11,9% lower for the new houses
(€1.506€ per M2) and 12,5% lower for the old ones
(€1.241€ per M2).
The real estate market in Bucharest continues to be the
most expensive nationwide. New construction in the
capital is 42% more expensive than in the second
ranking city, Constanta (south-eastern Romania).
When it comes to retail homes, prices surpass the
second ranking city, Cluj-Napoca (central Romania) by
19%. Other major cities with an active real estate
market are: Constanta, Timisoara, Cluj-Napoca, Iasi,
Brasov and Craiova.
Constanta is located in the southeast area of
Romania’s Black Sea coast. One of the main sources
of income driving the development of this city is
tourism. Constanta is one of Romania’s largest cities
with a population surpassing 300.000. Because of its
attractive location, Constanta’s real estate market is
driven by demand for holiday homes and from
investors hoping to get a share of the income
generated from the growing tourism industry. Among
the big cities, Constanta has the highest price decrease
for houses. From March 2009 to March 2010, the
average price for the new houses dropped by 13,3% to
€1.058 per M2 while the average for the old houses
dropped by 20,1% to €1.031 per M2.
Cluj Napoca is the third largest city in Romania. After
over a decade of continuing stagnation in housing
construction, Cluj-Napoca’s residential market
experienced the beginning of a construction boom in
2003. The total output was brought to a level of 900 to
1.200 residential units per year compared to 200 units
in earlier years. Cluj-Napoca is the only big city in
Romania where the prices for new constructions
increased at the beginning of 2010, contributing to an
annual increase (March 2009 to March 2010) of 5,1%.
On the other hand, the average price for second-hand
flats dropped by 5% over the same period.
Iasi (eastern Romania) is currently the cheapest city in
the large Romanian cities group. The average price for
resale houses is € 913 per M2 and €1.022 per M2 for
new homes.
Real Estate Transactions
According to the National Union of Notaries Public in
Romania, the number of transactions involving
housing and land dropped 28% in 2009, when
compared to 2008, down to 353.000 transactions.
Early in 2008, notaries had estimated a drop of at least
40 to 50% in 2009 real estate transactions taking into
account signals of the market situation and the
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 39 of 51
developments in the industry during the first month of
the year.
In the first semester of 2009, Romanian housing
market transaction volumes  were down 92%, from
€815 million for the first half of 2008 to just €62
million for the same period of 2009. At that same time,
the commercial property rental market dropped 60%. 
In total, approximately 1.300 apartments were sold
during 2009 (in apartment complexes with over 200
units), a 63% contraction compared to the year before.
Putting aside investors’ share in demand (which
accounted for 30% of the total sales in 2008), the
reduction in end-users’ demand was 50% in 2009.
Demand behaved differently throughout the year. The
first half of the year started with three months of
virtual deadlock that ended with total sales of 515
units, driven by projects that accepted the new market
conditions by offering lower prices and favorable
methods of payment.
In the second half of 2009, demand was supported by
the governmental program “First House”. However,
the program only influenced sales activity in the
projects with price reductions and offered apartments
in the limited range of € 60.000. In spite of this, an
additional 800 units were sold in the second half of the
year.
Mortgages
High financing costs drastically restricted the number
of clients eligible for mortgage loans. This was
reflected in the total volume of credit granted for
residential acquisitions. According to the National
Bank of Romania, at the end of the first half of 2009,
the annual average interest rate for mortgage loans was
11,89% for loans granted in RON and 9% for Euro
loans. When compared with the same period of the
year before (2008) the increase in interest rate levels
was significant, with a peak recorded in January 2009.
The conditions that ordinary people have to meet to
qualify for a mortgage (or other loan), are very strict
which caused the numbers of approved loans to
decrease considerably during the year. Mortgage
interest rates in Romania are dramatically higher when
compared to other European countries.
Demand from investors from abroad is low. A
significant negative effect on the sales rhythm was
induced by the RON/Euro depreciation. Between
January and June 2009 the exchange rate varied
between 4,02 and 4,20 RON/Euro, with a peak of
4,31 RON/Euro registered in the first quarter.
Compared to June 2008, when the RON/Euro
exchange rate was 3,64%, the depreciation was
significant. Because of the depreciation of the national
currency, the decrease in prices quoted in Euros was
tempered or even cancelled out in some cases.
New Developments
Before the accession of Romania into the European
Union there were a number of strict rules that
prevented foreign investors, to purchase land in
Romania. Since 1 January 2007, when Romania
joined the European Union, these rules have been
adapted; foreign investors are now allowed to purchase
land under certain conditions.
The applicable law divides the foreign investors in two
main categories:
1. EU persons: Citizens of EU member states; legal
persons incorporated in the EU member states and
stateless people domiciled in an EU member state.
2. Non-EU persons: Citizens, legal persons and
stateless people not from an EU member state.
EU persons can purchase land in Romania under the
following conditions:
- Land used for secondary residences or for secondary
headquarters after a 5-year term from the accession
of Romania into the EU (i.e. starting with January
1st, 2012).
- Agricultural land and forest land 7-years term from
the accession of Romania to the EU (i.e. starting with
January 1st, 2014).
Non-EU persons may purchase land in Romania
under the conditions of international treaties between
Romania and the states of origin of the buyers, under
a reciprocity basis.
The Romanian government set up a national property
registry office. The property tax system is now also
being restructured with the introduction of a new
property tax of 2 to 3% depending on the value, price
and year the property was built.
It is likely that there will be further changes to the real
estate laws in Romania. Most of these changes will
need to integrated into the Romanian Constitution as
well. The entry of Romania into the EU in 2007 is the
primary reason why the Romanian government is
likely to set upon a course to liberalize the real estate
laws and Constitutional provisions.
Outlook
Limited accessibility of mortgage loans will keep the
sales pace rather low. However, 2010 should bring a
slight improvement both in the number of new loans
and the number of units sold. Assuming the economic
slowdown will last for another two years in Romania,
an improvement in housing demand might be
expected in early 2011. This shall eventually result in
the stabilization of prices.
Bucharest’s demography shall be perceived as a
fundamental factor with positive influence on the
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 40 of 51
ERA ROMANIA
Bucharest, Romania
Tel: + 359 888 25 83 94
Fax: + 359 887 94 2217
info@eraromania.com
www.eraromania.com
development of the primary residential market in the
long-term. However, its current impact seems to be
hampered by the general economic situation. The
standstill, which resulted from a lower residential
lending volume in 2009, will not turn into an
immediate increase of transactions in 2010. It may
take up a year until a new offer will finally meet the
local buyer requirements and consumers buying power
capacities.
The 9.000 unsold units at the end of 2009, qualifies
the residential market in Bucharest as oversupplied at
the moment. However, when comparing the stock of
new apartments in Bucharest to other capital cities in
east and central Europe, it’s evident Bucharest lags
significantly behind in stock per capita basis. Thus,
over the medium to long term, we believe that
Bucharest’s residential market has great potential for
further development. Over the short term (2010), real
demand will greatly depend on the “First House”
program and any new governmental initiatives (e.g.:
5% VAT for all new apartments regardless of price
and size).
Most likely, 2010 will follow a similar pattern as the
previous year: supply levels will show very little change;
demand will depend greatly on governmental
initiatives and end-user confidence. Prices are expected
to continue a declining trend, but at a slower pace.
ERA Sweden
Average national increase in prices + 9%, and +13% in the capital city of Stockholm, outlook positive

SWEDEN
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average
Days on
Market
2009 vs 2008 6.38% 0.03% 0.00% -3.65% 2.06% 4.08%
Seller/
Buyer
-4.76%
Trend 2010 Increase Increase Increase Increase Increase Unchanged
Seller/
Buyer
Unchanged
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 41 of 51
General
2009 has been a rather rough year for brokers in
Sweden, due to anxiety over the financial crisis which
began in fall 2008. The outlook for the central
government budget and public finances though is
favorable. Despite troubled times in Europe, an
economic recovery, together with currently sound
finances, will nearly bring balance to the Swedish
economy as early as next year, with substantial
surpluses expected further ahead. This forecast brings
positive energy to households in Sweden and many
more real estate transactions are expected to occur in
2010 compared to last year.

The majority of Swedes live in owner occupied
dwellings. The rate of homeownership for 2009 has
increased to 75% compared to 74% in 2008. Low
mortgage interest rates and taxes have played a
significant role in the high level of homeownership.
The propensities to own a home together with
financial incentives and benefits have been the major
factors to the high percentage of homeowners.
The last few years we have also seen increased interest
in buying a home through a condominium conversion.
In real estate, a condominium conversion or condo
conversion is the process of entitling an income
property held under one title to convert from sole
ownership of the entire property (which often already
is a multi unit property) into individually sold units as
condominiums. Such entitlement is generally derived
from approvals granted by state/provincial and/or
local municipal authorities (and often other relevant
agencies, such as conservation authorities). Of the
reconstituted apartments are 94% located in
metropolitan areas and 74% in Stockholm.
Last year the number of households was 4.447.025
and has risen to 4.555.032 by year 2009. The average
persons per households are 1,97 individuals. The
average age of a homeowner/buyer is between 45 to
65 years old, but due to the low mortgage interests at
the moment, also younger people can afford to buy
their own place to an ever increasing extent.
The number of real estate agents was 6.432 in 2009
(6.380 in 2007). These agents were spread over 2.500
broker offices. The offices are divided between about
1000 owners/entrepreneurs. The 10 largest real estate
agencies have between 20 and 80 employees. Two-
thirds of all agencies have 2 or less people employed.
Recent trends show major agencies taking a larger
share of the total market. This allows for both
marketing and cost efficiency advantages. These
advantages have driven smaller agencies together and
to collaborate in a quest to become more cost efficient
to better compete. On average, 86% of house
sellers and buyers use a registered broker when
trading homes. In Stockholm the number is as
high as 92%. Statistic shows that using a broker
results in an 18% higher sales price.
Real Estate Transactions
The number of closed transactions in 2009 was
166.469 compared to 156.487 closed transactions
previous year (2008) a 6,38% year on year increase.
The Swedish capital of Stockholm contributes around
42% of the total sales revenue but only 26% of the
total numbers of real estate transactions.
Internet is the major marketing channel when selling
or buying a property in Sweden. The most common
site is www.hemnet.se. Approximately 90% of
apartments involve a trade through the internet. The
number of properties on the Internet is at the moment
around 1600.

European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 42 of 51
ERA SWEDEN
Stockholm, Sweden
Tel: +46 8 442 88 80
Fax: +46 8 442 88 89
info@erasweden.com
www.erasweden.com
For 2010 we see an increased number of properties for
sale, probably due to a more secure financial market.
Prices
Because of the economic situation, the Swedish
Central Bank decided to lower interest rates in the
second half of 2008. The average percentage lies
somewhere between 1 and 2%, the lowest rate since a
very long time.
During the first half of 2009 Sweden was for the first
time in a long time experiencing falling prices on the
real estate market. After the summer the prices started
to rise again but moderately and more cautiously than
in earlier periods. The average home in Stockholm was
sold for €315.199 in 2008.
House prices during the last 12 month period on
average nationally:
- Apartments increased: 16%
- Houses increased: 10%
Mortgages
The average Swedish buyer has a good and stabile
income situation. The buyer is therefore often offered
to borrow up to 90 - 95% of the purchase price from a
reputed bank. For the balance one needs to either pay
cash or offer other property as security. The normal
repayment period is between 30 to 50 years with
almost no installments on the first mortgage loans.
As a buyer, typically one can choose between fixed and
variable rate. The normal range for a fixed rate loan is
between 1 to 5 years but sometimes longer. Today, it is
more common to fix the rate for a shorter period such
as 2 years, compared to the last decade where a 7 year
fixed rate loan was a more standard time frame. The
current mortgage rate for a 5 year fixed rate is 4,30%,
a 10 year fixed rate 5,10% and the variable rate 1,65%
(April 2010).
ERA Sweden has recently launched its own house
mortgage, a product which is unique on the Swedish
market. “ERA house-mortgage” is predicted to give
substantial competitive advantages.
Outlook/Trends 2010
Housing has been identified as a segment with good
prospects in future years and is expected to have a
relatively rapid recovery due to stable cash flows. The
bottom of the Swedish property market has been
reached - and passed. Now buyers are available mainly
for residential properties. It is still a bit tougher for
commercial properties.
The average price for a house in the country has now
passed € 205.100 (2 million SEK). The price increase is
2% during the last three months (December-February)
compared with the previous period (September-
November 2009). If we look back on progress on an
annual basis, December 2009 - February 2010
compared with December 2008 - February 2009, we
see that the housing price increase all over Sweden.
The average price increase during the period is 9%.
The largest percentage change in Stockholm by 13%.
In 2010 we can see a more stabile market overall and
the prices will probably continue to rise.
Bank economists expect the Swedish Central Bank to
raise prime lending rate to 2% by the end of 2010 and
then another increase to 3% is anticipated by 2011.
Forecasts indicate that the figures of new house
construction during year 2010 will increase compared
to 2009 when the numbers were extremely low. The
new ownership form, apartments with similar
ownership as houses, may contribute to a positive trend
in the future. However, this is yet to be seen.
Summary
2010 is a year of hope for agents and brokers in
Sweden. After several tough years we now see a
brighter future with a more flexible housing market
and increasing prices.
ERA Switzerland
Stabile housing market, sideward price movements, crisis free

Switzerland
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average
Days on
Market
2009 vs 2008 -9.09% N/A 3.18% -0.90% 20.00% 40.00% Buyer -15.00%
Trend 2010 Decrease 0 Increase Decrease Increase Increase Buyer Decrease
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 43 of 51
Overall the Swiss real estate market proved to be
resilient in 2009, as was the case in 2008 when home
prices peaked during the 3rd quarter. In contrast to
other European countries, there was no crisis at all.
Prices
There was a sideward trend in real estate prices from
late 2008 through 2009. This trend appears to be
continuing into 2010. According to a Swiss real estate
index, the private house price index for the first
quarter 2010 reflected an incremental drop of ,34%
YOY change and the price index for condominiums
during the same period slightly rose by ,36%. The over
all private real estate index for the first quarter 2010
showed a slight decline of 0,04% YOY change.
Hot spots remain in the Swiss market, and are located
primarily in the Gold Coast area namely (Pfannenstil),
in tourist regions (Engadin); over a one year period
prices rose at around 3%, while in previous years (e.g.
2007) the pace of increase ranged between 10 and
15%. The least attractive markets were found in the
Seeland, Baselbiet and surrounding areas.
More than 90% of house transactions in the Geneva
Canton were over 1 Million CHF and in Zurich 40%.
Average prices per M2 for a single family home range
between 3.000 CHF/M2 (Jura) and 11.000 CHF/M2
in Zug and Geneva. Condominium price averages per
M2 were 2.000 CHF/M2 (Jura) and 8.000 to 9.000
CHF/M2 (Zug, Genva) resulting in an average price of
1 Million CHF.
Transactions
Construction activity has been robust for several years.
On average about 40,000 new housing units are
constructed annually. This trend is decreasing again at
a rapid pace. Over 45% of all building permits were
for condominiums. The proportion of newly
constructed private houses has been decreasing
continually for years and is now below 25%. The
proportion of projects for apartment buildings (rental
apartments) lies at 35%. Rental apartments are in
competition with condominiums. When interest rates
are low, condominiums “win”, however if rates go up
again, then there is a preference for rental apartments.
Construction is primarily taking place in the two
business regions of Zurich and Lake Geneva. These
newly constructed projects are generally absorbed
without any problems (at most there are local
exceptions). The market receives its best demand
through immigration: after the peak level of 2008 (net
migration of around 100,000 persons) 2009 still
65,000 persons. In 2001 to 2006 it was in each case
around 40,000. In most cases the immigrants are
highly educated and wealthy. Hence, the vacancy rate
in 2009 sunk further. New figures from the SNB show:
around 43% of the total Swiss private assets are
invested in property. Private property assets for SNB as
of the end of 2009 were 1.315 billion CHF.
Mortgages
Currently interest rates are low with variable rate
mortgages since June 2009 at about 2.74% There was
a tendency towards longer-term mortgages until end of
2009, then this began to shift. Many people wish to
profit from the current low rates of interest. In 2009
there was a sharp increase in mortgage volumes at the
cantonal and regional banks,, at the expense of the
margins. There has been a partial loosing of qualifying
criteria which normally requires a 20% down
payment, 5% load, and payments being 33% of a
wages. There is a risk of a moderate slowdown should
interest rates increase.
Outlook
In 2010 price developments are expected to continue
their sidewards movement, and sustaining current
positive market tendencies on the short term, does not
appear to be a problem as interest rates remain
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 44 of 51
ERA SWITZERLAND
Dübendorf, Switzerland
Tel: +41 448 821 004
Fax: +41 448 821 005
info@eraswitzerland.com
www.eraswitzerland.com
attractive. There is a risk that banks will revise their
requirement downwards, as there is far too much
cheap money on the market and competitive pressures
remain high.
- Sustainability not a problem at present, as interest
rates very lo
- Risk exists that banks will revise their requirements
downwards, as they have far too much cheap money
and the market competition pressure is high
- An interest rate rise is inevitable, bringing about the
risk of sustainability (above all, given the number of
short term mortgage agreements that are currently
being issued
- Should rates rise to a level causing the stock of
properties for sale to increase, this would cause
downward pressure on prices and weakened the
market. Hence the warning from the Swiss National
Bank and the tighter controls.
- Strong dependency on the further development of
immigration (i.e. in the last analysis a dependency
also on politics, and the topic concerning termination
of bilateral agreements)
- A crucial question remains of how quickly interest
rates will rise.
ERA Turkey
After an extended period of growth, the housing market takes a step back in 2009

TURKEY
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average
Days on
Market
2009 vs 2008 24.50% N/A N/A 11.88% N/A N/A Buyer Unchanged
Trend 2010 Unchanged Decrease Decrease Decrease Unchanged Unchanged Unchanged Increase
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 45 of 51
General Outlook
After enjoying a growth of 27 quarters, the Turkish
economy experienced a decline, which lasted four
consecutive quarters. This period of contraction was
an effect of the global economic crisis and lasted until
the last quarter of 2009 when a growth of 6% was
recorded. Since then, the growth tendency continued
into the first quarter of 2010. Indications are that this
expansion in the economy will continue.
Economic indicators show that the real estate industry
in Turkey reached its lowest point between the last
quarter of 2009 and the first quarter of 2010. The
tendency is now a gradual but steady rise, which
indicates that this process of development will be
extended over time.
Forecasts predict 2010 to be a year of normalization
and improvement for the real estate industry, though
the indicators from the first quarter of 2010 have been
rather diverse.
Despite the growth in the economy, the construction
industry continued to diminish resulting in a period of
decline lasting 8 quarters. In the second quarter of
2009 the recorded decrease rate of the construction
industry was 21%. Although this decline slowed in the
last quarter of 2009, the industry was rather
debilitated as the construction industry, together with
production and imports-exports industries are the
steam engines of the Turkish market place.
This could be considered a paradox as the latent
demand for up to 7 million units to be built by 2015
remains presenting a significant challenge due to the
mismatch between supply and demand.
In the last quarter of 2009 the rate of decrease of the
real estate industry began to decelerate and an increase
of granted residential building licenses, building
permits, number of residential transactions and
mortgages was recorded.
The number of building licenses granted in the last
quarter of 2009 peaked at a total of 186.992. The
total number of residential building permits for the last
quarter of 2009 was 113.549. This is an encouraging
development when compared to the third quarter of
2009, where the total number of licenses granted for
each segment was below 100.000. This is considered a
positive indicator of a revival in the market.
Transactions
The number of residential transactions has increased
in the last quarter of 2009, when compared to the
third quarter, adding up to a total of 116.229.
Government incentives on deeds and registration taxes
in the second quarter of 2009 have accelerated the
number of transactions resulting in the highest number
of transactions since the fourth quarter of 2007.
The total number of residential transactions in
Istanbul in the last quarter of 2009 was 25.254. The
cumulative transactions number for the three major
cities was 55.687 while the total number of residential
transactions for the remaining cities was 60.542.
Compared to 2008, these “other” cities experienced a
higher number of transactions in 2009 if we look at
the quarter to quarter results. Revival of the market
and transaction scores was notably higher outside the 3
major cities.
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 46 of 51
Transaction Summary 2008-2009
Interval Total Turkey Istanbul
3 Major
Cities
Other Cities
2008 Q1 112.168 29.411 60.783 51.385
2008 Q2 113.088 28.346 59.230 53.858
2008 Q3 109.333 24.360 52.559 56.774
2008 Q4 92.516 21.386 44.645 47.871
2009 Q1 108.861 26.091 55.068 53.793
2009 Q2 194.743 56.909 102.988 91.755
2009 Q3 111.913 22.896 52.464 59.449
2009 Q4 116.229 25.254 55.687 60.542
*TUIK (Turkish Statistics Institute)
Compared to residential markets, investments in
commercial real estate were rather limited in the last
quarter of 2009. The drop in sales and rental prices
did impede and transitioned into a process of a
conservative rise.
Prices
According to the Reidin Real estate Index some
prominent features of 2010 are as follows: In February
2010, taken that June 2007=100, Turkish composite
residential real estate sales prices have increased at a
rate of 0,44% compared to January 2010, 0,68%
compared to December 2009 and 6,06% compared to
February 2009.
Residential sales prices have fluctuated throughout
Turkey. Some price increase values of major cities are:
Kocaeli +0,83%, Istanbul +0,73%, Ankara +0,48%,
Bursa +0,55% Adana +0,26%, Antalya +0,55%.
Izmir on the other hand experienced a price decrease
of -0,41%.
When compared to 2007, a decrease rate of 8,3% in
prices has been recorded in the 2010 Turkish real
estate market. The rate of decrease in home prices for
this same period in some of the major cities is: Istanbul
-10,5%, Ankara -11,2%, Antalya -14,6% and Bursa
-9,3%. In Adana, Izmir and Kocaeli price increases
recorded are respectively; 3,1%, 0.4% and 5,2%.
Buying Tendency
According to a report published by the Turkish
Republic Central Bank, residential real estate buying
tendencies of consumers contracted with the effect of
the global crisis in the first quarter of 2009. In the
second quarter the buying tendency gained
momentum with government incentives, but this
decreased again in the third quarter of the year. In the
final quarter of 2009 a modest increase was recorded.
As of February 2010 buying tendencies have slightly
diminished yet again adding to the ongoing fluctuating
rates.
Rentals
Residential rental prices had also reached their lowest
point in the first quarter of 2009. Despite a small
increase rate in the second and third quarters of 2009,
the general trend in residential rentals is decreasing
prices due to residual stock. This trend can be noticed
throughout the last quarter of 2009 and first quarter of
2010.
Mortgage
According to research conducted by The Association
of Real Estate Investment Companies (GYODER),
with an increased stock rate of € 1,2 billion, the total
mortgage stock rate has reached a total of € 22,5 billion
in the first quarter of 2010. A gradual increase in
mortgages has been recorded in the past eight
quarters. Mortgages constitute 10,4% of collective
bank credits. According to current legislation, only
banks are permitted to issue mortgages.
According to the same research the number of issued
mortgages increased rapidly in the third quarter of
2009. The weakest interval with the effect of the global
crisis for mortgages was recorded to be the last quarter
of 2008 with a total of 27.441 issued mortgages
adding up to an estimated € 790 million. In the
subsequent quarters mortgages increased in numbers
issued and volume and displayed a strong position in
the third quarter of 2009 with a total of 96.808 issued
totaling € 3 billion. In the last quarter of 2009,
mortgages were consumed mainly for transfers and
second hand homes rather than new structures due to
diminishing interest rates.
The decreasing trend of mortgage interest rates seen in
the previous four quarters was sustained in the last
quarter of 2009 and through the first quarter of 2010.
The average monthly interest rate in 2010 was 0,90%,
however, a further decrease is not likely at this point.
The mortgage system has had a slow but steady rise in
Turkey. In 2003 the total number of issued mortgages
was 14.000 for the whole country. Five years later, in
2008, there were 280.000 issued mortgages. Between
2004 and 2009 the mortgage volume was multiplied by
13 reaching € 18,7 billion. In financial circles it is
predicted that there will be an approximate 10%
growth in mortgage volume this year to a total of
€20,5 billion. Though even at this rate the ratio of
mortgage to GNP will still remain at a very low of 4%.
Given that the growth rate and stability of the
economy are sustained, predictions are that the total
volume of mortgages will reach 40 to 50 billion Euros
in 4 to 5 years. Currently, the mortgage volume is at
€19 billion.
ERA TURKEY
Izmir, Turkey
Tel: +90 232 445 14 28
Fax: +90 232 445 14 28
info@eraturkey.com
www.eraturkey.com
Summary of Tables & Charts
AUSTRIA
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average Days
on Market
2009 vs 2008 -2.22% -1.61% -0.59% 0.00% -3.95% 0.00% Buyer -5.00%
Trend 2010 Decrease Decrease Decrease Unchanged Decrease Unchanged Buyer Decrease
BELGIUM
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average Days
on Market
2009 vs 2008 -6.95% -1.69% -0.31% -1.07% 0.00% 0.00% Buyer 13.40%
Trend 2010 Increase Decrease Increase Decrease Unchanged Unchanged Buyer Increase
BULGARIA
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average Days
on Market
2009 vs 2008 -29.88% -22.56% -18.23% 2.10% N/A N/A Buyer 100.00%
Trend 2010 Decrease Decrease Increase Increase N/A Unchanged Buyer Unchanged
CZECH
REPUBLIC
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average Days
on Market
2009 vs 2008 -21.85% -7.00% -8.38% -0.03% -4.12% -5.13% Buyer 36.84%
Trend 2010 Decrease Decrease Decrease Decrease Decrease Decrease Buyer Increase
FRANCE
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average Days
on Market
2009 vs 2008 -9.08% -5.00% -7.17% -0.80% 0.00% -3.57% Buyer 19.54%
Trend 2010 Increase Increase Increase Unchanged Unchanged Decrease Buyer Unchanged
GERMANY
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average Days
on Market
2009 vs 2008 1.00% -1.57% -3.15% -0.27% -5.26% -2.68% Buyer 5.11%
Trend 2010 Increase Decrease Decrease Decrease Decrease Decrease Buyer Decrease
GREECE
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average Days
on Market
2009 vs 2008 -27.08% -5.00% N/A N/A N/A N/A Buyer N/A
Trend 2010 Decrease Decrease Decrease Increase Decrease Decrease Buyer Increase
IRELAND
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average Days
on Market
2009 vs 2008 -42.46% -25.75% -20.95% 1.05% N/A N/A Buyer 24.22%
Trend 2010 Decrease Decrease Decrease Increase Decrease Decrease Buyer Increase
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 47 of 51
ITALY
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average Days
on Market
2009 vs 2008 -11.28% -4.10% N/A -1.20% -7.41% -9.52% Buyer 72.5%
Trend 2010 Decrease Decrease N/A Decrease Decrease Decrease Buyer Increase
LUXEM-
BOURG
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average
Days on
Market
2009 vs 2008
-17.80%
-10.29% -10.66% 0.70% -7.69% -12.50% Buyer
16.67%
Trend 2010 Decrease Unchanged Unchanged
Unchang
ed
Decreased Decreased Buyer Increased
NETHER-
LANDS
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average Days
on Market
2009 vs 2008 -30.08% -6.69% -7.41% -0.60% -44.44% -33.33% Buyer 37.18%
Trend 2010 Decrease Decrease Decrease Decrease Decrease Decrease Buyer Increase
PORTUGAL
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average Days
on Market
2009 vs 2008 -13.59% -24.00% -4.35% -2.00% -1.26% -1.26% Buyer -11.11%
Trend 2010 Decrease Decrease Unchanged Decrease Decrease Decrease Buyer Decrease
ROMANIA
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average Days
on Market
2009 vs 2008 -27.18% -16.67% N/A 0.60% N/A N/A Buyer 0.00%
Trend 2010 Decrease Decrease Decrease Increase N/A N/A Buyer Unchanged
SWEDEN
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average Days
on Market
2009 vs 2008 6.38% 0.03% 0.00% -3.65% 2.06% 4.08% Seller/Buyer -4.76%
Trend 2010 Increase Increase Increase Increase Increase Unchanged Seller/Buyer Unchanged
SWITZER-
LAND
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average Days
on Market
2009 vs 2008 -9.09% N/A 3.18% -0.90% 20.00% 40.00% Buyer -15.00%
Trend 2010 Decrease 0 Increase Decrease Increase Increase Buyer Decrease
TURKEY
N° of
Residential
Transactions
Avg. Home
Price/
Capital City
Avg. Home
Price/
Nationally
Mortgage
Rates
Number of
Brokers
Total N° of
Broker
Offices
Buyer or
Seller
Market
Average Days
on Market
2009 vs 2008 24.50% N/A N/A 11.88% N/A N/A Buyer Unchanged
Trend 2010 Unchanged Decrease Decrease Decrease Unchanged Unchanged Unchanged Increase
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 48 of 51
Chart 8
Total number of residential transactions (including new and resale properties) as reported for 2009:
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
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ERA Europe Market Trends Survey
Residential Transactions
2009
Chart 9
The average price of a residence sold nationally in 2009:
! 0
! 50,000
! 100,000
! 150,000
! 200,000
! 250,000
! 300,000
! 350,000
! 400,000
! 450,000
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ERA Europe Market Trends Survey
Avg. Home Price/Nationally
2009
!"#$%#&' '''()*'
'''()*'
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 49 of 51
Chart 10
The average price of a residence sold in the capital city in 2009:
! 0
! 100,000
! 200,000
! 300,000
! 400,000
! 500,000
! 600,000
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ERA Europe Market Trends Survey
Avg. Home Price/Capital City
2009
!"#$%#&'
Chart 12
The average mortgage rates for 2009; for more details on the terms and conditions please refer to the country
reports. There are variations in average length of mortgages and in variable and fixed rate loans offered:
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
12.00%
14.00%
A
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ERA Europe Market Trends Survey
Mortgage Rates
2009
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 50 of 51
Chart 13
Average time a property listing remains on the market before being sold, Days on Market:
-35.00%
-15.00%
5.00%
25.00%
45.00%
65.00%
85.00%
105.00%
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ERA Europe Market Trends Survey
Trend in Days on Market
2009 vs 2008
!"#$%#&' ()*' ()*' !"#$%#&'
European Residential Real Estate Market Trends 2010

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 51 of 51
ERA EUROPE
Winter Park, FL 32792
USA
Tel: +1 407 657-7992
Fax: +1 407 551-2031
info@eraeurope.com
www.eraeurope.com
In Europe:
Kathy Auclair
+33 6 61 60 06 29

ERA EUROPE
®

RESIDENTIAL REAL ESTATE MARKET TRENDS
Interim Market Review: 2009 Results & Outlook for 2010 Date of Publication: June 2010

This is the first edition of the ERA Europe Market Trends Report, and one of two reports that will be published annually by ERA Europe. Within this report we offer a comprehensive and up to date perspective on the status of the residential real estate market in Europe by comparing 2009 to 2008 results as they are available. In addition we offer insights into the trends of the first quarter 2010 and perspectives for the future. ERA Europe Master Franchise managers set forth country statistics (available upon the publishing date) from reliable sources such as governmental statistical offices, bank and mortgage institutions, and equally as important, analyze trends based on information from their respective ERA networks of brokers and agents. Pure comparison of some figures, however, is very challenging given the wide variation in types of data tracked in each country. Though there are efforts underway to harmonize the collection of data on an EU level, it is far from truly being achieved. Therefore the expertise of our Country Managing Directors and their keen market insights help bring perspective and balance to each market overview. The ERA Europe network was founded in France in 1993 and today has grown to 18 European countries with approximately 1.100 agencies. This report includes only countries where ERA Real Estate is present. For more information on ERA Europe, visit www.eraeurope.com. We believe that transparency is key to optimizing results for our clients; both buyers and sellers of residential real estate. Only then can complete trust be established between all parties involved in realizing a transaction and our goal of creating enduring, fruitful relationships with our customers be fulfilled. Team ERA Europe

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 2 of 51

European Residential Real Estate Market Trends 2009 & 2010

Contacts
ERA EUROPE 120 University Park Drive, Suite 285 Winter Park, FL 32792 USA Tel: +1 407 657-7992 Fax: +1 407 551-2031 info@eraeurope.com www.eraeurope.com
François Gagnon President francois@eraeurope.com Hélène Gagnon Kathy Auclair Master Franchise Development Chief Financial Officer kauclair@eraeurope.com hgagnon@eraeurope.com Paul Van den Putten Development paul@eraeurope.com

ERA AUSTRIA Gmunden, Austria Tel: +43 7612 64420 Fax: +43 7612 64430 info@era.at www.eraaustria.com ERA BELGIUM Aartselaar, Belgium Tel: +32 3 227 41 85 Fax: +32 3 227 41 82 info@era.be www.era.be ERA BULGARIA Varna, Bulgaria Tel: +359 52 66 13 00 Fax: +359 52 66 13 15 info@erabulgaria.com www.erabulgaria.com ERA CYPRUS Famagusta, Cyprus Tel: +357 23 816 444 Fax: +357 23 725 263 info@eracyprus.com www.eracyprus.com ERA CZECH REPUBLIC Prague, Czech Republic Tel: +420 224 83 59 52 info@era-reality.cz www.era-reality.cz ERA FRANCE Versailles, France Tel: +33 1 39 24 69 00 Fax: +33 1 39 24 69 01 info@erafrance.com www.erafrance.com

ERA GREECE Athens, Greece Tel: +30 210 322 2254 Fax: +30 210 322 2257 info@eragreece.com www.eragreece.com ERA IRELAND Dublin, Ireland Tel: +353 1 89 01 722 Fax: +353 1 89 01 723 info@eraireland.com www.eraireland.com ERA ITALY Milano, Italy Tel: +39 02 393 59 491 Fax: +39 02 393 59 441 info@eraitaly.com www.eraitaly.com ERA LUXEMBOURG Luxembourg Tel: +352 40 38 981 Fax: +352 40 37 9750 info@eraluxembourg.com www.eraluxembourg.com ERA NETHERLANDS Utrecht, The Netherlands Tel: +31 30 289 9900 Fax: +31 30 287 1109 era@era.nl www.era.nl ERA PORTUGAL Lisbon, Portugal Tel: + 351 213 600 150 Fax: +351 213 600 159 info@era.pt www.era.pt ERA ROMANIA Bucharest, Romania Tel: + 359 888 25 83 94 Fax: + 359 887 94 2217 info@eraromania.com www.eraromania.com

ERA SPAIN Alcobendas (Madrid), Spain info@eraspain.com www.eraspain.com ERA SWEDEN Stockholm, Sweden Tel: +46 8 442 88 80 Fax: +46 8 442 88 89 info@erasweden.com www.erasweden.com ERA SWITZERLAND Dübendorf, Switzerland Tel: +41 448 821 004 Fax: +41 448 821 005 info@eraswitzerland.com www.eraswitzerland.com ERA TURKEY Izmir, Turkey Tel: +90 232 445 14 28 Fax: +90 232 445 14 28 info@eraturkey.com www.eraturkey.com

www.eraeurope.com
Your contact for this report: Market Research & Master Franchise Development Kathy Auclair +33 6 61 60 06 29 kauclair@eraeurope.com

ERA GERMANY Duesseldorf, Germany Tel: +49 211 440 37 680 Fax: +49 211 440 37 689 info@eradeustchland.de www.eradeustchland.de

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 3 of 51

European Residential Real Estate Market Trends 2010

Table of Contents

A European Perspective on Residential Real Estate ERA Austria ERA Belgium ERA Bulgaria ERA Czech Republic ERA France ERA Germany ERA Greece ERA Ireland ERA Italy ERA Luxembourg ERA Netherlands ERA Portugal ERA Romania ERA Sweden ERA Switzerland ERA Turkey Summary of Tables & Charts

5 12 14 16 19 21 23 25 27 29 31 33 35 37 41 43 45 47

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 4 of 51

European Residential Real Estate Market Trends 2010

A European Perspective on Residential Real Estate
Long & short term views... Important divergences in residential real estate trends emerge in 2010

2010: A tangible recovery in nearly every market where ERA Europe brokers are present.
Perspective. Given the economic turmoil and market uncertainty during this past year we hope to offer some perspective, (less hype) on how these factors have impacted the European housing sector. It is clear from the ERA Europe country reports included in this compilation, that there is an important and growing divergence between the various EU housing markets. Some are faring much better than others, and for different reasons. There is a relative calm noticed in Northern markets (Netherlands excluded), while economies to the South (ie. Spain, Greece, Portugal) are still struggling. Other contrasts exist when comparing Western Europe and how they rebounded from the 2008 setback versus Eastern Europe’s emerging markets. Again, it is all about history, cycles and internal market dynamics. To begin, one can clearly state that the home market in Europe during 2009 and thus far in 2010 remains a buyers market in nearly all countries reporting herein, with the exception of Sweden and Switzerland. As expected, there are important variations from country to country, each with its own market cycle and macro economic influences. Furthermore, differences were seen within county regions, as well as rural versus urban centers. Austerity measures being implemented in the southern European markets versus crisis rescue plans in northern European markets, all had, and continue to have, a direct influence on the home buying/selling process, and more precisely consumer confidence. Having said this, there are clear indications from our 2010 Country Reports that a recovery is being experienced in nearly every market where we are present. There are important differences in the depth and pace of the rebounds, and there are a number of factors that could still adversely affect the gains made thus far in 2010. So the markets remain fragile in many regions. Nearly all European countries are reporting increase in buyer demand in the first quarter 2010, a slowing in the pace of price declines, and in the stronger markets, actual price growth when compared to the first quarter of 2009. Transaction levels are either stabilizing or increasing across-the-board. Mortgage rates remain at historic lows (with the exception of Bulgaria, Romania and Turkey), and in some cases are even edging slightly upward. Accessibility to financing still remains a challenge for many buyers who must abide by stricter loan requirements, and more hefty down payments. ERA Europe management is on the ground dealing with buyers and sellers of real estate each day; working with real estate brokers who’s singular goal is to address the needs of their valued clients and to bring greater knowledge, professionalism, and transparency to the market place. ERA Europe has been operating in the European market for nearly 20 years, and ERA Franchise Systems, Inc., globally for nearly 40 years. Our Master Franchisors include within these reports their personal experiences and knowledge of their markets. We know that markets are cyclical; this is normal and should be anticipated. The 2008 sub-prime crisis that began in the US and so severely impacted the home market there and subsequently spread to Europe and elsewhere, however, was unprecedented. Therefore it is our goal with this summary report to offer a balanced and informed view of that market reaction, a clear perspective of each residential market where ERA Europe is present.

(Important note to reader: a more comprehensive version of this report will be issued and posted towards the end of the year on www.eraeurope.com web portal. Pending reports from Cyprus and Spain will be included in the second edition. Please contact your local ERA Country Headquarters or ERA Europe (contact information noted within report) for any questions or clarifications concerning the reports herein.)

ERA Europe © • www.eraeurope.com • All Rights Reserved • June 2010 • Page 5 of 51

showed that housing prices peaked in the second half of 2008 with an overall increase of 13.com • All Rights Reserved • June 2010 • Page 6 of 51 . the overall picture remains bleak with a likely slow.00% ERA Europe © • www.91% off the index high point in 2008) but still remaining in positive-growth territory.00% -10. Italy and Austria. Switzerland and Sweden.)<% *+"# )"# ("# '"# &"# ""# %"# $"# !"# *)(*# *)(!# *)($# *)(%# *)("# *)(&# *)('# *)((# *)()# *))+# *))*# *))!# *))$# *))%# *))"# *))&# *))'# *))(# *)))# !+++# !++*# !++!# !++$# !++%# !++"# !++&# !++'# !++(# !++)# Source: ECB Statistical Data Warehouse Referring to the same report. statistics show Euro area countries that fared the best./'01(2%3#$4'#56%70/'8%% *!"# **"# )=:><% 9:. were Ireland and the Netherlands. Home Price/Nationally 2009 vs 2008 5. These countries were followed by more modest increases in Greece. drawn out recovery. Chart 1: Residential Property Price Index Statistics !"#$%&#'(%)*%+%. In the middle we find the markets of Austria. By the second half of 2009 prices on average grew by 9.00% -20.eraeurope.00% -25. thereby establishing a trend of softening prices (-4. Frank Doonan. According to our ERA Ireland Managing Director. the solid price growth the EU 16 experienced over the past 20+ years is clear (Chart 1). with modest transactions declines and modest price corrections. Bulgaria and Romania were the most affected. When stepping back even further and viewing longer term price trends. A recent report issued by the European Central Bank (ECB) on residential housing prices for the EU 16 combined (using 2005 as a base year).European Residential Real Estate Market Trends 2010 European Prices . Not all housing markets were touched as dramatically.' PORTUGAL NETHERLANDS LUXEMBOURG (-. In Central Europe.7%.'-. now also showing continued signs of recovery in 2010. Stable economies and tightly controlled lending practices helped sustain consistent demand.#&"' SWITZERLAND SWEDEN !"#$%#&' TURKEY -5. Belgium.a view of how the crisis affected prices over the long term Before viewing specific country reports it is important to understand price history on a European level. Short Term YOY European House Price Trends The housing markets where ERA is established in Europe most affected by the global downturn as well as by difficult internal economic dynamics in Western Europe. Chart 2: Change in Average Home Price Capital City ERA Europe Market Trends Survey Trend in Avg.00% CZECH REP GERMANY GREECE IRELAND AUSTRIA BELGIUM BULGARIA CYPRUS FRANCE ITALY (-.00% -15. and those with double digit increases include: Belgium. Slovakia and Sweden.00% !"#$%#&' 0. and France. however. in terms of price growth. France. Slovenia. there are niches in Ireland where prices have rebounded and some signs of stability within the country are noticed.' ROMANIA ()'*+. Countries that experienced net negative price growth over the past 5 years include Ireland (the most dramatic decreases of all Euro zone markets).51% off the base year. On the other end of the spectrum were Germany. Sweden was one of the few European markets exhibiting minimal affects from the crisis. the UK and Malta.

00% 20. Luxembourg the Netherlands and Romania.00% 10.00% -30. This is clearly reflected in transaction levels noted below. Sweden was surprisingly resilient in contrast to all other markets.00% -30. Despite attractive mortgage rates.00% 0.European Residential Real Estate Market Trends 2010 Source: ERA Europe Chart 3: Change in Average Home Price Nationally ERA Europe Market Trends Survey Trend in Avg. fear of investment loss (stock market declines). fear of overpaying (buying too high) or of not selling at the right price (too little negotiating on the part of sellers).00% 5. in pre-crisis times.00% -15. Exacerbating the situation were the many uncertainties in the market place: job security.00% -20. These were also countries which. the market response to the USA initiated sub-prime/ securitization crisis resulted in significant attitude changes on the part of both consumers and lenders in Europe. Chart 4: Change in Residential Transactions ERA Europe Market Trends Survey Trend in N° of Residential Transactions 2009 vs 2008 30.00% -25. Greece.#&"' SWEDEN SWITZERLAND !"#$%#&' TURKEY -5. Cyprus. Home Price/Capital City 2009 vs 2008 15.com • All Rights Reserved • June 2010 • Page 7 of 51 .00% 10. had the steepest price increases. Most mortgage markets continued to experience falls in new lending over the previous year. recorded the most dramatic drops in transaction levels. accessibility to financing was curtailed by implementation of stricter lending practices. affordability issues. The most dramatic downward shifts (declines in the range of 30%) in transactions closed year-on-year (YOY) were found in the countries Bulgaria. while lenders reassessed their underwriting conditions and the prices of their higher risk loans/products.00% !"#$%#&' BELGIUM CYPRUS CZECH REP FRANCE GERMANY ROMANIA AUSTRIA BULGARIA GREECE IRELAND ITALY NETHERLANDS PORTUGAL LUXEMBOURG ()'*+. These falls have ERA Europe © • www.00% 0. The EMF states there were several key observations during 2009 in the mortgage markets: 1.00% Source: ERA Europe European Mortgage Markets 2009 According to the European Mortgage Federation (EMF).00% -50. Ireland.eraeurope. Cyprus with -48% and Bulgaria and the Netherlands with approximately -30%.00% -10.00% -60. European consumer attitudes were to adopt a more cautious approach to spending when taking out loans. and so on.00% -20.00% -40.00% Source: ERA Europe Residential Transactions in Europe Year 2009 was a period of withdrawal and hold for many buyers of residential real estate.00% IRELAND PORTUGAL BELGIUM BULGARIA CYPRUS CZECH REP FRANCE GERMANY GREECE NETHERLANDS ROMANIA SWEDEN SWITZERLAND ITALY AUSTRIA TURKEY LUXEMBOURG -10.

00% 1.6% in Q4 2009) and Italy (from 21. New lending activity showed some progress in year-on-year terms in Belgium. improved housing affordability and some short-term recovery at the macroeconomic level. Cyprus reports there were over 50% fewer brokers in 2009 followed by the Netherlands with 44% less brokers operating. where there is continued resistance to price adjustments listing periods remain more lengthy as seen in the markets of Bulgaria. 4. where fixed-rate mortgages are traditionally predominant. and the Netherlands. It is now evident that brokers with more substantial operations who have forged long term business plans and those associated with reputable companies.5%). such as the ERA Europe network. Cyprus.9% to 66. They were not capable of responding quickly enough. Sweden and Switzerland. On the other hand.00% -2. such as Bulgaria. Germany and the UK. these brokers have also gained credibility. Further office closures are anticipated throughout 2010 in most of the markets mentioned above. were the most exposed to the swift market downturn. Smaller independent brokers with one or two sales agents. The percentage of change YOY in the number of days a listed property remained on the market 2009 vs. Their data shows. It is the ECB’s policy to maintain its Euro Zone lending rate which currently stands at 1%.com • All Rights Reserved • June 2010 • Page 8 of 51 . at the same level throughout 2010.00% 2. not only survived the downturn but gained market share. for example.European Residential Real Estate Market Trends 2010 2. and non-network affiliated offices with tight budgets. on the previous quarter. narrow operating margins and less service support.00% -4. 3.00% Source: ERA Europe Real Estate Agency Trends There has been a severe retraction in the number of real estate agencies operating in numerous European markets. Sweden and Denmark and. such as in Belgium (from 3. Ireland. in France. reaching historical lows in some markets. Continued decrease in mortgage interest rates throughout 2009 also impacted consumers’ preferences in terms of mortgage interest type for new mortgage loans according to the EMF. Most importantly.eraeurope. A sort of ‘cleansing’ of the industry is taking place and consolidation of the brokerage market is underway. but positive developments on a quarter-on-quarter basis were recorded in France.00% -3. Mortgage interest rates continued to record substantial decreases both on a quarter-to-quarter basis and on the previous year. that there was a remarkable shift from Q4 2008 to Q4 2009 towards variable rate products in some markets. As residential listing prices come in line with the market demand we see a shortening of the number of days a property as seen in Portugal. In 2010 continued stabilization of Euro Zone interest rates is expected. Chart 5: Change in Mortgage Rates (basis points) ERA Europe Market Trends Survey Change in Mortgage Rates (basis points) 2009 vs 2008 3. was rather important in most markets.00% 0. Italy and the Netherlands. Sweden and the UK. nor did they have ample financial reserves to survive.7% of total new mortgage loans in Q4 2008 to 47. ERA Europe © • www. generally stabilized now due to a number of factors: the continued expansionary interest rate environment.00% !"#$%#&' GERMANY GREECE IRELAND NETHERLANDS PORTUGAL SWEDEN SWITZERLAND BELGIUM BULGARIA CYPRUS CZECH REP FRANCE ITALY ROMANIA AUSTRIA TURKEY LUXEMBOURG -1. House prices continued to decrease over the previous year in all markets surveyed (except for Belgium and Portugal). Spain. 2008.

Income levels encompass the hugely important factors of unemployment and fear of salary reductions as negative demand influencers for residential property. that influence demand for residential property. they can be divided into three categories. 3. Any positive impact on demand for accommodation from improving demographics will only be factor if potential investors and homeowners have access to sufficient capital (percentage of loan to value) at an affordable interest rate. Demographic growth is inextricably linked to economic growth as a growing economy will attract larger numbers of foreign economic migrants.00% 0. structural. The recent and sustained period of low interest rates in Europe led to an increase in owner occupation as buying a property has become more affordable (percentage of average industrial wage needed to service an average mortgage). This must be borne in mind when expressing property prices as national averages.00% 80. CEO . owner occupied detached houses. The age profile of a population is also crucially important as demand will be strong if large numbers of people move into the family forming age group of 30 to 40 years.00% -40. Opportunity is also a main factor in the level of demand for various geographic areas and across the various housing categories such as rented accommodation. there are a few key factors. ERA Europe © • www. Structural: Demographic growth is the most important structural factor to influence demand for housing. etc.00% 20.00% 60. however. This can emanate from local growth in population and population shifts in the form of inward migration. It is the relative price of buying or renting a residential property as compared to the prices of other goods. however.eraeurope. 1. wherever the market. Economic: Income levels and interest rate trends are the most important influencers of demand for residential property and are usually short term and cyclical.ERA Ireland 2. Geographic shifts of people within a market will also give rise to local variations in demand and therefore variations in prices paid for residential property. If servicing a mortgage or rental of a property compares favorably (better value) to how one might otherwise dispose of income. There will be long term growing demand for residential property if there is net growth in population.00% !"#$%#&' AUSTRIA CYPRUS FRANCE GERMANY GREECE BELGIUM BULGARIA CZECH REP ()*' IRELAND NETHERLANDS PORTUGAL ITALY LUXEMBOURG ()*' ROMANIA SWEDEN SWITZERLAND !"#$%#&' TURKEY -20. Migration is a much more volatile factor as inward migration can reverse quickly if an economy contracts. Despite continuing low interest rates. this will drive demand for suitable accommodation. demand for residential property in many European markets has contracted due to tighter bank financed money supply and rising unemployment.com • All Rights Reserved • June 2010 • Page 9 of 51 . Opportunity: This factor relates to the opportunity cost of acquiring accommodation. apartments. economic and opportunity factors.00% 40. Contributing source for ‘Drivers’: Frank Doonan.00% Source: ERA Europe Drivers of the European Housing Market The diversity of the European housing market is evident as the full spectrum of market conditions are being reported within this report.European Residential Real Estate Market Trends 2010 Chart 6: Change in Days on Market ERA Europe Market Trends Survey Trend in Days on Market 2009 vs 2008 120.00% 100.

5 66 2005 2006 2007 2008 2009 2010 Source: US Census Bureau ERA Europe © • www.04 million existing homes available for sale. The US housing market peaked in 2006 when nearly 7 million housing transactions closed.58 million in July 2008.000 $125.First Quarter 2010 The US home marked peaked in 2006 in contrast to Europe where markets began peaking in various countries from 2006 to mid 2008.0% in March. and dropping from a peak of over 69. Chart 7: USA Homeownership Rate 2005 to Q1 2010 !"#$%&'(&)*(+. from an upwardly revised 5. but remains 11./$012(.-. and are 22. town-homes.000 $200.6% below the record of 4. compared with 35% in March.5 69 68. Chart 7: USA House prices 1970 .eraeurope.4-month supply at the current sales pace. many positive results have been recorded during the initial months of 2010. condominiums and co-ops) increased 7. Prices .5 68 67. The US Federal Reserve Bank of New York states that the rate could potentially fall even further by another 5 percentage points to levels seen in the mid 1980’s.77 million units in April 2010.8% higher than the 4. up from an 8.000 $25. Distressed homes accounted for 33% of sales in April.5 67 66. up 4% from April 2009.000 $75. So does a US housing recovery imply a European housing recovery as well? Here we set forth some market trends for 2010 in the US market and there are striking similarities.000 $100. Raw unsold inventory is 2. Inventory Total housing inventory at the end of April rose 11.70 million unit pace in April 2009.000 $175.1-month supply in March.000 $250.6% to a seasonally adjusted annual rate of 5.000 $50.000 Inflation-adjusted house prices $225.1% in 2005. It is often said that the European markets follow the US market.000 $0 1970 1972 1976 1978 1980 1982 1986 1988 1990 1992 1996 1998 2000 2002 2006 2008 1974 1984 1994 2004 2010 Year Source: US National Association of Realtors (NAR) Homeownership Rate: US Homeownership rate is currently at 67.36 million in March.5% to 4.Q1 2010 USA House Prices $275.1%. Transactions Existing home sales (completed transactions that include single-family.000 Price Nominal house prices $150. Though. the situation remains fragile in the US home market as fears of a double-dip recession set in.100 in April 2010.7% higher than a year ago. This represents an 8.a view of how the crisis affected prices over the long term The national median existing home price for all housing types in the US was $173.com • All Rights Reserved • June 2010 • Page 10 of 51 .European Residential Real Estate Market Trends 2010 USA Market Trend Glance . a reversal back to levels recorded in quarter one of the year 2000. Monthly sales rose 7.$ 69.

Improved consumer confidence .3% (2006 est.7% of European households have only 1 person.com • All Rights Reserved • June 2010 • Page 11 of 51 .482.Continued low interest rates .2% 21.9% 10% Statistical year/ Source 2009 2009 USA 307 106 130 Statistical year/ Source 2009 2009 2010 est 2009 US Census Bureau NAR Apr-10/NAR Conversion 1€ = 1.2% over 2008 to 500.2010 (1) An increase of 3.0% 50.7% US BoLS .22$ NAR 2007 Eurostat ERA Europe est.000 €141. lowest in Germany. least populated is Malta. 2.European Residential Real Estate Market Trends 2010 What will continue to drive the US market?: .eraeurope.455 8 Months Eurostat Eurostat Eurostat Eurostat . A total of 27.8% 27.Favorable affordability conditions European and USA Market Comparisons Population in Millions (1) Households in Millions Housing units in Millions Persons per household (2) Homeownership Broker market share Average Home Price Average Home Price Supply of homes Owner Occupied w/o Mortgages Owner Occupied with Mortgages Disposable income spent on Housing Unemployment 2010 EU 27 500 209 N/A 2.) ERA Europe © • www.4 71.Government tax credit inducements (ending on 30 April 2010) . compared to the equivalent US average of 27. Population increases are due to immigration (8 out 10 new people).0% N/A N/A N/A 44.10% 79% $173.59 67. Most populated EU 27 country is Germany. Germany and Spain are the countries with highest number of new immigrants (2) Highest density was in Turkey.231.2010 N/A N/A N/A 9.

95% Decrease 0. Only one-third desires to live in the suburbs.22% Decrease Avg. 6% of respondents stated that they had to entirely abandon their dreams of a purchase and as an alternative chose to rent. however. In 2008 the majority of homeowners in rural areas wished to keep their countryside residences under any circumstance.e. homes with quality features and amenities are in greater demand. they instead chose to remain in their existing residence for a longer period of time. 20% stated that due to the many difficulties encountered when seeking to buy.00% Unchanged General Among those seeking a residence in Austria in 2009. Additionally. it is perceived that cities with a developed infrastructure and business environment offer more security in terms of jobs. Poorly equipped dwellings in low-grade condition and inadequate energy efficiency are a very difficult sell. more recent trends for this group indicate they are prepared to move closer to city centers. This further intensifies trends toward purchasing a home in the city. sale of flats vs.00% Decrease 0. Home Price/ Nationally -0. Properties constructed between 1950 and 1980 are experiencing a serious image problems as they must be renovated.European Residential Real Estate Market Trends 2010 ERA Austria Austrian homebuyers feel pressure from the global downturn. 80 to 90%) in the past years when purchasing their home. However. homes increases.eraeurope. Home Price/ Capital City -1. According to a 2009 survey of home buyers: 38% of respondents stated that securing financing had become more difficult. Homeowners also have to consider both the time and costs of traveling to and from their workplace. over one-third sought to purchase a single family home. ERA Europe © • www.com • All Rights Reserved • June 2010 • Page 12 of 51 . Buyers who sought high loan-to-value ratios (i. However.. Top criteria such as having a nice terrace and a garden. Currently we are experiencing a renaissance of the cities.00% Unchanged -3. This is mainly due to exercising of restrictions of the Basel II banking regulations. based on comparisons with 2008 figures. modernized and made more energyefficient in an effort to improve their salability. opted for flats. a significantly higher portion than in 2008. as this is still considered a secure and traditional form of investment in Austria. In 2009 there was an increase of 11% of buyers who said that they wished to improve energy efficiency when seeking another home. Those decided to buy. The majority of real estate seekers in Austria desire to live in the city center or in the immediate vicinity. This group of buyers represented 34% of the homebuyer market in 2009. Two-thirds of the buyers are looking for “new built” property while only 25% is willing to live in old buildings. which is an attempt to regulate finance and banking internationally. when reviewing the demand for mortgage loans only every second loan was honored by mortgage bank institutions. N° of AUSTRIA Residential Transactions 2009 vs 2008 Trend 2010 -2. Many buyers who were flush with cash opted to purchase flats in the city centers. It is reported that 56% of buyers seek homes close to their current residence. 26% in the neighborhood within 15km of their actual residence and only 10% seek homes in another province.59% Decrease Mortgage Rates Number of Brokers Total N° of Broker Offices Buyer or Seller Market Buyer Buyer Average Days on Market -5. the demand for these type of homes was down by as much as 20%. in 2009 demand for rental properties was on the rise by 30% year on year and these rental seekers represented about one-third of the demand for housing. The top reasons for changing a residence are 1) size/ space 2) infrastructure 3) energy efficiency and a desire for more attractive surroundings. Contrarily. Even so.61% Decrease Avg. remain. the move will not be too far from their current residence. a good portion of potential buyers simply gave up. In general. a trend which intensified following the crisis. Rental demand rises. in spite of the market difficulties. pursuit for urban centers accelerates. In general. had to explore other options in 2009 or simply put-off their plans to purchase a home.

It is yet to be seen how these developments may affect the mortgage markets. especially the southwest region towards Tulln and St. At the time of this writing. if there is increased pressure on Austrian banks (already with comparatively low margins to the rest of Europe) from a growing exposure to bad real estate loans.at www. ERA AUSTRIA Gmunden. the number of buyers is four times as high as the number of sellers. however. Nevertheless. Strongest demand was found in Kärnten (Carinthia) and on the other end of the spectrum was Burgenland with lowest demand. As did the lake areas of Salzkammergut. four out of ten Austrian real estate brokers are in serious danger of either losing or closing their businesses. In Vorarlberg we can see the highest demand for homes in the area of the capital city Dornbirn. however.Pölten county. All in all buying real estate in Austria is currently an attractive investment for people with cash.. the capital City of Innsbruck.Pölten. Nevertheless. and they should remain so for the coming year. In Salzburg county. at the northern part of Austria. experienced an overall decrease of 15% in prices over the year.2%. Outlook For the short term it is anticipated that the housing market will remain relatively stable without dramatic shifts.a modest decline of 2. home prices in Salzburg City. Mortgage Rates The banking/mortgage industry in Austria is highly competitive which has resulted in interest rates remaining quite low. A weakening in the banking sector can have an additional impact on this trend. because of decreasing number of sellers in these parts of Austria.European Residential Real Estate Market Trends 2010 Regional Tendencies The capital cities (of the 8 provinces) are the clear winners in terms of real estate demand. for example. transaction data was not yet available for 2010. In Burgenland. For example. Typically loan terms range between 10 to 20 years. by up to 20%. Wels and Steyer (center line). while Salzburg County. Buyers that have 20-30% cash on hand have a better chance of getting more attractive loans with a lower interest rate: the better their Basel II-rating. have not only been able to maintain existing offices but have improved their business results and reached extraordinary achievements under these difficult circumstances. the city of Salzburg remains a sought after location (price increase for houses were around 6% in 2009). Price Tendencies While the general trend is negative. became less interesting for buyers.eraaustria.com • All Rights Reserved • June 2010 • Page 13 of 51 .000 in 2008 to 88. however.000 in 2009. already changed in 2010.51% in mid 2009.eraeurope. Linz. Transactions The increased regulations in the banking sector had its influence on the number of transactions registered in 2009. with an up-tick in new housing sales as mortgage financing remains very attractive for this particular sector. This trend. Tyrol. a possible change in this dynamic may occur in 2010 despite historically low ECB rates. The most attractive region was Mödling. indications are that transactions are showing a very stable trend in comparison to 2009. In Innsbruck and Salzburg. Prices were more stable in the most attractive areas of the country. This group is mainly found in the segment of non-network brokers. up or down. we can say that many consumers wish to invest their funds in real estate for fear of greater losses elsewhere.com ERA Europe © • www. and in some cases higher. Many uncertainties on the horizon allow only a short term view of the housing markets. Austria Tel: +43 7612 64420 Fax: +43 7612 64430 info@era. with the strongest increase in house moves indicated in St. The Südburgenland area (Vinearea). the lower the mortgage rate applied. Research from the leading Realestate Media Immobilienmagazin revealed that due to the unprecedented difficulties experienced in the real estate market in 2009. increased by approximately 6%. with regard to house pricing. Only one in two loans were honored by mortgage bank institutions in 2009. all experienced good demand. and the holiday region Kitzbühel also experienced great demand. mainly due to exercising of restrictions of the Basel II banking regulations. certain networks. price tendencies tend to differ in the various regions of Austria. In upper Austria. There are other areas where prices dropped dramatically. such as ERA Austria. Transactions decreased from about 90. only the more charming areas around the lake Neusiedlersee were attractive buys. According to the Austrian MFI’s the average loan rate was 3. According to the European Central Bank rates were at 67% of the September 2008 peak by June 2009. However. transaction levels and interest rates. Consumer confidence will be swayed during the year by concerns over the Euro devaluation and inflation. In the most southern parts of Austria demand concentrates around the Vienna suburbs.

The net amount spent on mortgage payments as ERA Europe © • www. sales have boomed in the first quarter of 2010.  The prices of apartments across the country have increased about 1% on average. About two-thirds of residential properties sold. The number of units sold should also see an upturn in the year.95% Increase Avg. transactions decline slightly. Contrary to what might be expected. ERA Belgium warns that when long term interest rates increase substantially. In 2009 112.000. are houses. However.  Mortgages Long term fixed mortgage rates dropped in early 2009 to just under 5% from a little above 6% in late 2008.5% but the average transaction price was down by only 1.000 apartments were sold in Belgium. contrary to general expectations. ERA brokers report a continued increase in average transaction prices but warn that this is mainly due to a stronger recovery in the middle price range compared to prices in the lower range. The average sales price of a house in 2010 has remained more or less unchanged compared to 2009. property prices have not come down and are not likely to come down as much as in most other European countries and the US. It is our experience that buyers do not increase the amount spent on mortgage payments when rates go up.719 homes were sold. These rates further decreased gradually to around 4. this was only 7% less than in 2008 and the average sales price was down by only 0.5% at the time of writing.4% compared to the year before and the total number of houses sold was 5. Home Price/ Nationally -0.00% Unchanged 0. Buyers are aware of the exceptionally low interest rates and they also know that. Belgium came through the worldwide real estate crisis relatively unscathed.6% less for the year.com • All Rights Reserved • June 2010 • Page 14 of 51 .000.000 out of a total of 112. the Belgian housing market resist.721 for a house in 2009 was down by only 1. instead they just buy at a lower price.31% to an average of € 192. with a modest increase in most provinces and a slight decrease in others. with sales in the lower end market picking up by the end of the year. the average transaction price will decrease again. In 2009 a total of 36. Outlook At the time of writing. which led to the indicated increase in the average sales price of all apartments compared to the previous year. more of these apartments were sold. up by 2%.31% Increase Mortgage Rates Number of Brokers Total N° of Broker Offices Buyer or Seller Market Average Days on Market -1.eraeurope.7% compared to the first quarter of 2009. a strong recovery from the exceptionally weak start experienced in 2009.  As there was a large supply of new builds. at an average of €231.40% Increase Summary As expected. Houses versus Apartments The Belgians mainly live in single-family homes as opposed to apartments.European Residential Real Estate Market Trends 2010 ERA Belgium Prices remain stable.07% Decrease 0. but total units sold are not expected to return to the high levels seen in 2007 for some time.814. at €177.775. It appears that the confidence of middle-income families has already picked up whereas lower-income families remain hesitant to buy.69% Decrease Avg. Prices & Transactions-2010 Market Conditions Belgian notaries reported that after a sluggish start.00% Unchanged Buyer Buyer 13. the average sales price was. mainly due to an unusual cold and long winter.69%. The number of transactions in the capital Brussels was down 17. Transactions were up by 13. Home Price/Capital City -1.  The average transaction price of € 198. In Belgium newly build apartments sell at a premium compared to existing apartments. with a gradual recovery anticipated during 2010 N° of BELGIUM Residential Transactions 2009 vs 2008 Trend 2010 -6. prices in this category are expected to remain unchanged. this is 10% less than 2008. 77. ERA Belgium is positive about the outlook and expects a further gradual recovery of the market.

Based on the above.era.European Residential Real Estate Market Trends 2010 percentage of their income remains unchanged and the average Belgian will buy a cheaper property at a time of higher interest rates.com • All Rights Reserved • June 2010 • Page 15 of 51 . By postponing. ERA Belgium  recommends buyers not to postpone the acquisition of a home. Belgium Tel: +32 3 227 41 85 Fax: +32 3 227 41 82 info@era.be ERA Europe © • www.be www. they run the risk of not being able to buy the same property with an unchanged budget.eraeurope. ERA BELGIUM Aartselaar.

average housing prices declined to BGN 1. About 13% of the Bulgarians own more than one property. Foreign Investment Market The total inflow of “emigrants’ money”. FDI in construction and real estate amounted to € 208 million.2 million. In urban areas one’s home represents the largest part of household wealth. For the 12 months until September 2009 Bulgaria has managed to attract € 836 million of FDI in real estate. Real Estate Transactions The number of real estate transactions in Bulgaria in 2009 declined by almost 30% to 217. dynamic construction activity. The number of closed deals in 2008 was 309.European Residential Real Estate Market Trends 2010 ERA Bulgaria Hit hard by the global crisis.23% Increase Mortgage Rates Number of Brokers Total N° of Broker Offices N/A Unchanged Buyer or Seller Market Buyer Buyer Average Days on Market 100. In Varna. market prices have decreased by 5%. The decline in asking prices in Sofia is about 3 to 4% relative to our last observation in early September 2009.00% Unchanged 2. both transactions and prices plunge in 2009. Home Price/ Capital City -22.by 27%. the asking price decline is nominal for one-room apartments (about 2%) and more tangible for two-room and three-room apartments (on average 5% and 4%. Nominal differences between prices in cities with the most expensive and most affordable housing remain significant.224 more on average than one M2 of a residential property in Kyustendil. Cautious optimism in 2010 N° of BULGARIA Residential Transactions 2009 vs 2008 Trend 2010 -29. the constantly intensifying competition among residential developers (thus providing greater choice for consumers).88% Decrease Avg. comprised of income from abroad and current transfers. However. declined by 5% over the past year while foreign direct investment (FDI) in real estate declined by 60%. especially in cities where there is little difference between market prices and construction costs. Almost 97% of Bulgarian homes are privately owned. Home Price/ Nationally -18. This type of housing is traditionally more sensitive to potential changes in the business cycle.989. in Bulgaria it is not necessarily a sign of financial prosperity. The most dramatic drop in prices is seen in the high-end segment of the market.7% in the number of transactions when comparing the periods. where prices are at BGN 550 per M2. Varna remained the city with the most expensive housing.223. In the last trimester of 2009 the number of transactions was 69. which is the biggest decline on annual basis reported thus far. A gradual slow is expected in the decline of both housing asking and market prices. Decreases in selling prices outpaced the decline in construction costs significantly. This indicates a fall of 28. Prices Official data for regional cities showed an annual price decline of 28% in the third quarter of 2009.com • All Rights Reserved • June 2010 • Page 16 of 51 . Ministry of Justice. In the first half of 2009.115 with this number for the same period last year being 96.10% Increase N/A N/A General Bulgarians enjoy one of the highest homeownership rates in the world. according to data provided by Registry Agency. and relative to September 2008 . While homeownership is considered a key indicator of social status in Europe. and the large number of Bulgarians working abroad. In absolute terms.788.021 per M2 in this quarter. There are a number of reasons behind the high level of homeownership in Bulgaria: the rapid residential market growth over the last years. and 5% of Bulgarians also have a country house. which means that the starting of new projects for residential buildings will be severely limited in the coming quarters. as the difference between prices in Varna and Sofia kept expanding.3% compared to the same period in 2008 when the this category amounted to € 511.  a decrease of 59. this decline varies depending on the size of the apartment and the price segment. in contrast to Sofia.eraeurope. One M2 of living space in Varna costs BGN 1.56% Decrease Avg. Relative to the second quarter. respectively). The slower annual decrease is partly attributable to the lower starting ERA Europe © • www. The owners inhabit 94% of the properties while 5% are rented out.

A growth in the number of transactions finalized with bank loans has also been noticed.5% and 9.  April 2009 was the first month of revival of the mortgage market caused by the activation of the housing market.  The average size of a mortgage loan has now reached 2008 levels and exceeds € 40.2% These trends persisted through the end of the year and the industry reported significant growth compared to beginning of 2009.6% 16. During the last quarter of 2009 consumers in Bulgaria have borrowed amounts averaging between € 30.200 nationally.com • All Rights Reserved • June 2010 • Page 17 of 51 .  Requests for mortgage loans grew by 15%. the average volume of mortgage loans rose to € 39.03% 2009 6. The major share of lending volumes concluded at the beginning of the year. however consumers continued to seek optimal repayment terms. the average decrease in market prices of dwellings throughout the country for the first quarter of 2010 was 2.eraeurope.24% 22.85% 24.600 in 2007. customer satisfaction and bring real value added services for buyers and sellers of real estate. Mortgages Issued .3% 17.8% compared to the corresponding period last year.  The prices for newly built apartments have decreased approximately 3%.46% 30.79% 13.  Relatively low mortgage indebtedness of the population is an indicator of financial health of households and their ability to adapt relatively painlessly to adverse external shocks. Transacting the Sale . ERA Bulgaria is developing entirely new and modern managing and training methods to meet the requirements and the needs of its Bulgarian customer base. 2010 Price Trends: Price Declines Ebb Dramatically According to data provided by the Bulgarian National Statistical Institute. The majority of loans are granted for a 16 to 20 year duration followed by the other most common term of between 10 and 15 years. Mortgages Early in 2009 adverse affects were already being seen in Bulgaria from the US and subsequent European economic crisis. have fallen at an average of 2% and in some areas of larger cities  at about 9. namely the third quarter of 2008 which was the first quarter in which the global crisis reflected tangibly on the dynamics of housing prices in Bulgaria.000.66% 31. Early in quarter three of 2009.  Younger consumers of mortgage products returned to the scene as well.6% 24.59% 5.75% 23.% by Age Group Age Group Years 18 – 25 26 – 35 36 – 45 Over 45 2007 10% 48.European Residential Real Estate Market Trends 2010 point.58% 17. Furthermore an increase in re-payment difficulties was seen in the proportion of home sales that included mortgages.24% 48. The main reasons for the negative shift were: an extremely weak activity (demand) within the first half of the year as well as decline in property prices combined with the requirement for higher levels of buyer funding (down payment). namely those of concrete structures typical of the communistic era.Distribution by Age Years Up to 10 10 to 15 16 to 20 21 to 25 26 to 30 Over 30 2007 3. 2010 Mortgage Trends In first quarter of 2010 we observe renewed activity from banks now willing to resume financing of up to 80% of the selling price.51% 2009 3% 53.51%.48% About 8% of residential property in the country is financed by mortgage debt.260 against € 46.3% compared to quarter four of 2009 and 17. The average decrease in market values in larger cities was 4.  The general economic situation in the country led to a decline in allocations over € 70.000 and € 50.  The shortening of the mortgage re-payment period continued until the end of the year.5% 26.000.New Developments In November 2009 the Bulgarian government voted to change laws for notaries and notary activities. adding ERA Europe © • www.07% 2008 7. The average volume of a mortgage loan decreased by 22% and amounted to € 36.97% 28. These services will build trust.92% 8. Mortgage Duration . In cooperation with ERA global network.21% compared to last quarter of 2009.  Prices of specific types of dwellings.92% 9. were realized by pre-approved credit transactions agreed to before the crisis occurred. Interest rates in 2009 varied between 8.5% 21.5% and 11% for BGN loans.800 in 2008 and € 38.  Within the second quarter of 2009 buyers in the middle class returned to the market.5% for a Euro-based loan and between 9.2% 12.  Loans with a maturity between 26 and 30 years that were the most popular in 2008 experienced a sharp drop in 2009 as significant rate hikes startled cautious buyers.3% 2008 9.38% 24.3% 43. Real Estate Agencies Over the last 6 months many of the real estate agencies in Bulgaria have closed down as a result of the slowing real estate market – some permanently and others only for a short period with the intention to reopen when the market starts to rehabilitate from the crisis.000.09% 7.

Bulgaria Tel: +359 52 66 13 00 Fax: +359 52 66 13 15 info@erabulgaria.  Those in this group often work in the sector of information technologies. each party/ signatory bears criminal  responsibility.com ERA Europe © • www. In early 2010 two groups of buyers were noticed.com www.eraeurope.5 and 1%. a healthy balance by any standard. which was initially tracked in late 2009.European Residential Real Estate Market Trends 2010 statements requiring that all payments for real estate transactions take place through a bank.  Financing for properties will remain around 55 to 70% of the transaction price. This new approach involves a complete transition to a system of pecuniary transactions.  A new section will be included in the deed.  This still requires a minimum 20 to 45% down payment on behalf of buyers. The return of this partly speculative interest is a good sign for the future of real estate market. It serves as a declaration. The fund will be sustained by a percentage fee deducted from each transaction.erabulgaria. 2010 Outlook There are two main factors that will determine the state of the housing market in 2010 in Bulgaria: the level of buyer income and the credit markets.  there will be no requirements on how the payment should be done. Interest rates continue to follow a declining trend. We anticipate a further reduction in rates of between 0. ERA BULGARIA Varna. This group is even inclined to withdraw a 100% financing. The first group of buyers is between 25 and 30 years old. On second reading it was held that this rule for paying via bank transfers will only apply  to properties exceeding BGN 10.000. In the first months of 2010 we have already noticed the activity of buyers with stable income engaging in transactions through bank financing.com • All Rights Reserved • June 2010 • Page 18 of 51 .  Intentions are that it will not compete with commercial banks and will not bear interest. The purpose of the legislative change is to prevent the use of real estate transactions for money laundering and to counter problems concerning property fraud.  The law will establish a state deposit insurance fund in which one must enter and distribute all notary fees and taxes related to notary acts. in banks or in private medical practices. a more liquid property may reach 80%.  Penalties for falsely declaring transaction prices can range from 1 to 6 years imprisonment and a fine of 100 to 250 Leva. The second group consists of buyers of 40 to 50 years that are investment minded. especially if it remains present over time. and has bought their home with a mortgage. while some loans in BGN may decrease by as much as 1.  The number of Bulgarians working abroad and buying property in Bulgaria is now very small. thus. stating the exact price of the transaction. For transactions of lower priced properties.5%. if it is proven that the amount paid varies from the declared amount.

13% Decrease Buyer or Seller Market Buyer Buyer Average Days on Market 36. often including a requirement of over 40% down payment to secure the mortgage. The reason for this stability is that owners of properties in such locations do not have the need to reflect market trends and economic situations. noted a radical break in year 2009. transactions stall in 2009. Outlook Autumn 2010 and beyond Keys to the continued progress of real estate market are now in the hands of the banks.385 mortgages.03% Decrease Number of Brokers -4.319 units which is 14% less than in 2008. once again. In 2009 the selling price was 6% less on average than the asking price (Czech Statistic Office). These conditions are extremely difficult to reach when most buyers will not consider investing in an apartment unit of a developing project that is not certain to ever be launched. house prices remained at the same 2008 level. The motivation for buying a property changed: motivation was now based on the real needs of customers to own a residence at an affordable price. Another factor contributing to the decrease in number of transactions is the fact that purchases from property speculators totally came to a halt.85% Decrease Avg. a tool that will eventually lead to stabilization of asking prices. In 2005 the asking price and selling price were almost identical.00% Decrease Avg. This occurred for the first time since the start of the 90´s. The chance of obtaining a loan was at its lowest point. this is almost 50% less compared to 2008 (Hypoindex). standards that almost 40% of customers cannot show.12% Decrease Total N° of Broker Offices -5. During the 2009 economic crisis Czech people learned to negotiate the price of the property. It is a natural process necessary for renewal of customer trust in the real estate market and its indicators.European Residential Real Estate Market Trends 2010 ERA Czech Republic Residential prices decline nationwide. In sites such as the center of Prague and in the areas where employment is more secure. after almost 15 years of continual growth. To obtain a loan for a development project one must to have a 30% personal investment capital and the same percentage of pre-sold units. and that for loans to development companies. Development of new residential properties.000 units higher year-on-year.84% Increase Price trends In year 2009 ERA brokers in the Czech Republic noted an average decrease of 7. given tighter restrictions.eraeurope. The Czech Statistics Office states the volume of new developments in 2009 was lower than volume of completed development projects.3% in prices throughout the country’s residential market.com • All Rights Reserved • June 2010 • Page 19 of 51 .38% Decrease Mortgage Rates -0. CZECH REPUBLIC 2009 vs 2008 Trend 2010 N° of Residential Transactions -21. It is important to point out. In 2009 banks approved 39. ERA Europe © • www. Completed developments were at 1. Home Price/ Capital City -7. Year 2009 was the first decrease experienced after several years of steady growth that began in 2005 when prices rose consistently at a healthy pace of 8% annually. However. This occurred mainly in areas where unemployment exceeded 15% and in locations where the trend of increasing prices rose to such high levels that people simply could not afford to buy. Newly started development projects during the year amounted to 37. Transactions There was also a decline in residential mortgages in 2009 and this is one of the best indicators for tracing the number of transactions. mortgage credit restrictions continue downward pressure on demand expected to result in another challenging year for the residential market. there were some other regions in the country where prices dropped by over 30%. In some cases. The banks will also determine the market of the basic home mortgages. For a home mortgage the buyer still needs to prove high credibility and reliability. Home Price/ Nationally -8. the selling price was even a few percentage points higher. This continuous trend of rising prices changed direction in year 2009 because of effects linked to the economic crisis and the fact that property prices began to stray from their real value and affordability levels. the utmost importance of property location.

for at least another two years. March is showing some signs of revival as banks approved 50% more mortgages than in February 2010. signs of an ever so slight increase in prices are already being seen in second quarter of 2010.European Residential Real Estate Market Trends 2010 In February 2010 the situation had not yet improved. If one is considering buying a property as a primary residence then most observers will say there is no reason to wait for further price reductions.com • All Rights Reserved • June 2010 • Page 20 of 51 .385 mortgages during the first two months of 2010. this is 500 less compared to the same months of 2008. Czech Republic Tel: +420 224 83 59 51 info@era-reality. Developers believe that in year 2010 prices will increase by 6% and in 2011 by another 3%. However. if buyers wish to purchase for investment purposes then real estate experts do not have good news for these types of buyers.eraeurope. Bank institutions approved only 5. as was the case in 2007. Research states that developers expect prices in 2010 to remain at the level of approximately 89% of year 2008 prices and 92% of 2009 prices. However. a Hyposervis. as experienced before the crisis. Based on the research of Deloitte.cz ERA Europe © • www. not even development companies expect any major price shifts in the near future. Though now. Sales prices for second-hand properties reflected a slight decrease of 0. compared to the last quarter of 2009.90% during the first quarter of 2010. will not be seen any time soon nor should one expect prices to increase beyond the range of 10%. ERA CZECH REPUBLIC Prague.cz www.era-reality. Another boom. Lenders are focusing once again on their clients’ needs by lowering mortgage rates which are now at their lowest point since the start of the real estate crisis (Association of mortgage Brokers).

000. nonetheless. and Portuguese.000. Prices According to data from the Notaires de France/INSEE.Residential Real Estate Market Trends 2010 ERA France Modest price corrections in 2009. which is incentivized by tax reductions. The average price for a Parisian dwelling in 2009 was €6. New home sales increased by 32% over 2008 when 79. representing a 20% decline. At the lower end of the market was Pas de ERA Europe © • www. 5% less than in 2008. This is was not in line with French government objectives since the idea was to increase homeownership and not investor driven purchases. Resale transactions continued to decline. Transactions A total of 695.17% Increase Mortgage Rates Number of Brokers Total N° of Broker Offices Buyer or Seller Market Buyer Buyer Average Days on Market 19.000 transactions were closed during year 2009. Estimated number of days a property remains on the market is about 104 days. Though interest rates remain favorable. According to a monthly market study completed by the INSEE (March 2010) consumers are pessimistic about their futures. Rankings for the more expensive regions in France begins with Alpes Maritimes where an average home costs around €400. In the Paris metropolitan area the downswing was more pronounced: -7. largely shifting the buyer profile share to the investors.208 per M2.000 professionals.54% Unchanged -0. Estimates by ERA France put the number of real estate agencies currently operating on the market at 58.000 real estate agencies. a sector of buyers that continues to grow every year in both the new-home and re-sale markets. Italian. Home Price/ Nationally -7. Media estimates of plunges in the residential market were clearly less dramatic than originally foreseen. Of the 105. followed by Dutch. and then Ile de France €275. Cautiously optimistic 2010 Outlook N° of FRANCE Residential Transactions 2009 vs 2008 Trend 2010 -9. particularly concerning unemployment.21%. The average size of a home sold is 135 M2 and an average size apartment sold is 64 M2. followed by les Bouches du Rhône (€258.eraeurope. the viability of the housing market is still subject to the solvability and morale of households (consumer sentiment). they question for how much longer? Many uncertainties persisted at the start of 2010.08% Increase Avg. and their capacity to save. The foreign home buyer market (topped by British.000 new home transactions only 35.5% in the Province for both houses and apartments. inflation.000 (33%) became homeowners.80% Unchanged 0.6% in the Ile de France. and 3. and shifts in interest rates.000). Market share for real estate professionals is estimated at 60% with average broker fees of 5. trends also reflected that larger city metropolis’ better resisted these downward pressures.400 transactions were recorded. Belgian. Home Price/ Capital City -5. in 2009 the price of resale homes declined by 5. According to the Observatoire du Financement des Marchés Résidentials more than half of buyers in 2009 were under the age of 35. a government initiative designed to aid new homeowners enter the market. Expansion of the new home market is being largely sustained by the Scellier program. compared to 56% in 2008. The average percentage of taxes per transaction is at 7%. The crises did not dampen their dreams for a first time home.5% for houses and -4. Spanish and Tunisian) declined during the year to 4%. and about 27.com • All Rights Reserved • June 2010 • Page 21 of 51 . of which 105.57% Decrease General Market contractions encountered in France during the first semester of 2009 subsided during the second half of the year resulting in a slight recovery. Though year-end market statistics show an average yearly decline in both prices and transactions. Though there is relief at the more clear and positive market trends seen during late 2009. however more modestly than anticipated in early in 2009.000 were new homes. results in 2009 could not rival the record transaction figures of 2007.5% for apartments.00% Increase Avg. compared to 5% in 2008.00% Unchanged -3. this trend has been confirmed in the first quarter of 2010.

com www.com ERA Europe © • www.4% increase in just three months for the Ile de France region. Bourgogne. Corse. however there were regional disparities. Champagne-Ardenne. Average home prices are at €6.000). This might be best reflected in recent sales figures from notaries in the Ile de France region stating an 80% increase in transaction levels over 2007 peak figures for the first quarter of 2010. Mortgages The average 15-year fixed rate mortgage was 3. an unpredictable economic situation. this is equivalent to a volume of 100 million Euro issued. On a national level the average home price was €201.430.com • All Rights Reserved • June 2010 • Page 22 of 51 .000 in 2008: a 10% increase approximately. Lack of product on the market particularly in the French Metropolis combined with overall strong demand nationally. (Federation of Builders and Developers) announced price increases nationally in 2009 of 4. le Nord (€140. and PACA. plus the increasing mobility of the French and weakening dollar are all factors that will help drive this market area to more positive and stable territory.000 in the first quarter 2010. Alsace and FranceCompté.Residential Real Estate Market Trends 2010 Calais (€128. Aquitaine. Picardie.000).erafrance. France Tel: +33 1 39 24 69 00 Fax: +33 1 39 24 69 01 info@erafrance. compared to €187. This effectively erases the price declines of 2009. The Bank of France states that during the first trimester of 2010 there was strong demand for mortgages given the loosening of lending criteria. while price hikes were seen in Basse-Normandie. which further encourages a return of buyers to the market. ERA France is optimistic on perspectives for the 2010 home market. and a persistent and low level consumer confidence combined with an important decline of new starts in housing. increasing unemployment (3. a 3. Listings on the market dropped by 10% and an increase of 18% in the volume of transactions closed has been recorded thus far in (first quarter) 2010.4 million in France). Price declines were noted in Pays de Loire. There is no doubt that the effects of the financial crisis on the housing market are still in play.eraeurope. On the other hand. a 1% decrease over the 2008 average rate. Concerning the new home market.6% in 2009. the Fédération des Promoteurs Constructeurs. Outlook 2010 will be a year of positive transition and stabilization for the residential real estate market in France.2% in 2009 for new homes. ERA FRANCE Versailles. interest rates remain historically low and there appears to be a softening of seller demands.000) and the LoireAtlantique (€175. or a 28% reduction in mortgage volume (Observatoire de Production de Crédits Immobiliers). compared to 141 million Euro issued in 2008.

transaction levels have and will remain relatively flat due to the consistency in buyer and seller motivations. since they understand these low rates will not last forever.57% Decrease Avg. for the first time ever. Prices As stated above if there are no market exaggerations no bubbles can explode. Price variations can be seen. Though many Germans are able to afford buying property. H i g h e s t homeownership rates are found in rural areas. however. as in the last several years. This describes the German real estate market best.15% Decrease Mortgage Rates Number of Brokers Total N° of Broker Offices Buyer or Seller Market Average Days on Market -0. divorce. Germany therefore remains a nation of renters. as prices are reasonable and interest rates are low. In rural areas.11% Decrease Stable home market for both prices and transactions. Recent trends show homeownership differences between West Germany (47%) and East G e r m a ny ( 3 8 % ) a r e d i m i n i s h i n g. conservative lending practices. Germany seems to be the only country in the EU that did not demonstrate pricing excesses and therefore experienced no significant price corrections. making it less vulnerable to supply/demand peaks and valleys. Other stabilizing factors include the low level of investment in residential real estate at 5. slight increases expected in both areas in 2010 N° of GERMANY Residential Transactions 2009 vs 2008 Trend 2010 1. and the government emergency measures implemented in 2009 that helped maintain relatively low unemployment levels. which include: increase in family size. Home Price/ Nationally -3. and still lags far behind the EU average of 62%. very stable. now at 7.27% Decrease -5. slight increases expected in both areas in 2010 Germany enjoys one of the most stable housing markets in Europe. and just 4% want to buy within the next 2 to 3 years. Of current tenants 59% wish to buy property in the future. may be one of the market stabilizing factors. 60% of people live in an owned house or apartment while homeownership rates average about 25% in German cities. No extreme boom or bust scenarios occurred in this residential market in recent years.European Residential Real Estate Market Trends 2010 ERA Germany Stable home market for both prices and transactions. Inflation concerns which may cause demand to spike (thus prices to rise) are also motivating buyers to invest now.68% Decrease Buyer Buyer 5. when comparing newly built homes with second-hand homes and when comparing rural with urban areas. in fact. and still remain. there are indications that residential transaction levels in 2008 mirrored those of 2007 and that in 2009 had an increase in the figures. an initiative was taken by a professional group of valuation experts to seek cooperation from all German regions to share real estate statistics and consolidate information on a national level. The historically low level of interest rates on mortgages are inciting buyers to invest now.00% Increase Avg. not just residential. relocation and scaling up or down in property size. but only 20% have concrete plans. This largely contrasts the turmoil seen elsewhere in Europe. the trend is stubbornly unchanged partly due to the highly affordable rental rates. This.eraeurope. 37% of Germans own houses and 6% own apartments.5%. in 2009.com • All Rights Reserved • June 2010 • Page 23 of 51 . death. General Germany’s homeownership rate of 43% remains unchanged.26% Decrease -2. Prices in city centers as well as in metropolitan areas edged slightly upwards by 1% to 2% due to the influx of people to ERA Europe © • www. However. 46% live in rented properties and 8% live with their parents. as land is far cheaper there compared to city plots.5% of the GDP. According to the research institute Empirica. especially when combined with its traditional. Transactions National real estate statistics are difficult to obtain in Germany since this is generally managed on a regional level. Though the data published in this April 2010 report includes all forms of real estate. Home prices in Germany were. Of all Germans. Nevertheless. Home Price/Capital City 1.

Therefore financial options for clients are improved compared a year or two ago. followed by Hamburg +3. retail shops. The elder population will be an important sector of buyers taking part in this trend as they sell their rural estates and move to the greater comfort and convenience of a city center. Continued historically low interest rates.de ERA Europe © • www. prices for apartments and houses in smaller cities and rural areas edged downward. Germany Tel: +49 211 440 37 680 Fax: +49 211 440 37 689 info@eradeustchland. Prices per M2 for apartments increased on an average of 2.5% (to €2. However. expected to remain relatively stable. Mortgages Mortgages are at historically low rates. As a result.de www. but between rural and urban areas. where there is good infrastructure.73%. Germany in effect has two distinct markets. sellers are choosing to stay put for now.5% to 4.8% (to € 2. more recent indications are that house prices in this capital city may slide back by a few points in 2010.com • All Rights Reserved • June 2010 • Page 24 of 51 . Berlin’s market proves to be panic-proof. meadows and greenery.100€ per M2). Banks are also prepared to finance private buyers who have 20% equity. Paradoxically. and loss of trust in the financial (stock) market appear to be driving this demand. ranging from 3. As home values are considered more-or-less assured.066 per M2). On the other hand. and uncertainties present today in the Euro zone derived from unprecedented deficit financing. Future trends are for buyers to move toward the more affluent suburbs near larger city centers.2%. The majority of these mortgages are closed at 10 to 15 year fixed rates because of the favorable conditions. ERA GERMANY Duesseldorf. Outlook The residential housing sector is. there is lack of supply right now.4% (to € 1. the most dramatic increase being Berlin +4. as sellers are uncertain how to reinvest their funds once their property is sold.612 per M2) compared to 2008.eraeurope. inflation fears. However.5% (to €2. again. while apartment buildings increased by 0.European Residential Real Estate Market Trends 2010 inner city districts and tight supply as the pace of new developments remains slow in these areas. There are often large price disparities within city centers as well. The dividing line is no longer between East and West Germany. If we compare 2008 to 2009 second semester figures prices increased in eight German cities.8% (to €1. until the situation becomes clearer. market observations thus far for 2010 show a strong upswing in demand to nearly double that of 2009.eradeustchland. prices are expected to increase in these areas.330 per M2). In mid-June the ECB pegs the average variable rate mortgage at 3.750 per M2) and Düsseldorf +3. Home buyers seek a sound and safe investment in housing with reliable returns compared to what is viewed as the more volatile financial markets.

property rentals rates have increased. the equivalent value of those transactions declined by 42. All urban areas combined recorded a decline of 3. Both of these statistics concern sales involving a mortgage institution and not cash sales. there is little doubt that both these indicators.6%. Fixed rate loans ERA Europe © • www. the number residential property transactions involving a mortgage lending institution declined by 39. Home Price/ Capital City -5.  These are significant YOY declines under any circumstances. shortly before the new VAT regime was imposed (2006).08% Decrease Avg. This process will undoubtedly take some time to fully resolve. therefore smaller size properties are selling.148. in the area of 10% for metropolitan Athens and slightly higher in other areas.1%. Although forecasts concerning the level of GDP reduction and increase in unemployment rates greatly vary.com • All Rights Reserved • June 2010 • Page 25 of 51 . Consumer sentiment deteriorated quickly. will fare worse than hitherto expected. Last year. which started to decline with the credit crunch that followed the collapse of Lehman Bros in September 2008. In the months that followed the fated event. stabilization not expected before 2013 N° of GREECE Residential Transactions 2009 vs 2008 Trend 2010 -27. The latter year saw the peak of the relevant house price index. Transactions The number of transactions peaked in 2005. Home Price/ Nationally -3. The generalized insecurity and fear of a State default that preceded the international bailout led to a localized collapse in real estate transaction numbers over a few short months. According to the BoG-Eurosystem real estate market analysis for 2009. 2009.  For 2009 the most important YOY price drops for 2009 were recorded in  Thessaloniki  at 6. although real estate is expected to maintain its fundamental value.25 Increase Number of Brokers N/A Decrease Total N° of Broker Offices N/A Decrease Buyer or Seller Market Buyer Buyer Average Days on Market N/A Increase General Economic outlook Under the burden of heavy fiscal imbalances.4%.000 properties changed hands each year in Greece.2% in the overall volume of square meters was recorded. critical for Real Estate market performance.21%. increased by 13 basis points to 3.0% for both apartments and dwellings. a fact that is expected to be reflected for some time in residential sales.European Residential Real Estate Market Trends 2010 ERA Greece Sharp fall in transactions and decline in prices. as both State finances and the economic outlook for the coming years worsened. Under the joint IMF-EU Agreement. Greece had to seek international assistance in April 2010. though at a diminished pace.   Prices According to the Bank of Greece (BoG) residential property prices continued drifting downwards in 2009 for all dwellings and in all areas.eraeurope. The austerity measures promised during negotiations that led to the Agreement will put further pressure on an economy which is already in recession. at 215. was the worse year in decades with transactions falling below the 100. interest rates in March 2010 for a variable rate housing loan or an initial fixed rate one-year loan.00% Decrease Avg. Prices also declined from their nominal peak in 2008. Furthermore. although this also has to do with the movement of populations to newly built areas or away from inner city quarters now rapidly repopulated by economic immigrants. something that was confirmed by published Bank of Greece Statistics for 2006-2008. Greek banks severely reduced the flow of funds to all economic activity and gave specific instructions to appraisers to lower their estimates of property prices. According to the BoG.40% Decrease Mortgage Rates 0. Government debt is expected to climb to 150% of GDP by 2013 before beginning to fall.000 mark: only 94. a decline of 41.2% followed by Athens at 5.801 transactions took place in 2009 according to Bank of Greece data. On average about 160-170. BoG estimates tend to be on the conservative side. Several areas have experienced double digit drops. Contrarily.   Mortgages A substantial decline in the value of residential real estate transactions closed was recorded in 2009. albeit slightly.

Special thanks for report preparation to: Dr. real estate is expected to fare better than other more exposed sectors of the economy where sales have collapsed. Falling in this range is an estimate of about 50. buys that were unimaginable just a few years ago. Depending on the willingness of banks to lend.000 transactions for the year.eragreece. real estate will retain its intrinsic value. as owners of large property portfolios seek to liquidate their positions to avoid a heightened tax burden and/or anticipated price declines. We already have a steady stream of people seeking to sell in order to alleviate the consequences of losing a job or closing their business. The sellers’ resistance to lower the prices is expected to be somewhat dampened by increased unemployment rate and the deepening recession. Broker – Owner ERA Polis – ERA Acropolis ERA GREECE Athens.000 sales nationwide which was published in the daily press. 2010 will be another buyers market with some spectacular opportunities materializing. Greece Tel: +30 210 322 2254 Fax: +30 210 322 2257 info@eragreece.com www. Overall however. This is already escalating the number of properties on the market. we estimate 45-80. who also must place a large down payment. additional taxes are expected to be levied on property.com • All Rights Reserved • June 2010 • Page 26 of 51 .European Residential Real Estate Market Trends 2010 from one to five years increased by 12 basis points to an average of 4. Outlook 2010 Mortgage lending is expected to tighten with further restrictions on new lending being imposed.79%. Kosmas Theodorides. The anticipated price movements will occur in different degrees depending on local parameters. The true problem though is the reluctance of the banking sector to give loans to anyone but the most credit-worthy candidates.com ERA Europe © • www. Under the International Economic Control agreements.eraeurope. Although it may sound like little solace.

75% Decrease Avg.95% Decrease Mortgage Rates Number of Brokers Total N° of Broker Offices N/A Decrease Buyer or Seller Market Buyer Buyer Average Days on Market 24. Apartments in provincial towns with significant oversupply are reported at -60% off peak and demonstrate the largest price decrease in the ERA Ireland report. Apartment living for many first time buyers was generally seen as a necessary starter property before moving on to a family home. Your local ERA estate agent with local knowledge and national marketing capability will help you wade through all the factors influencing the price you should guide your house for sale.eraeurope. so the decrease in mortgage lending continues. * For the purposes of this survey property prices peaked in Ireland in autumn 2006. in or adjacent to population centers with good local services. though pace slowing thus far in 2010 with regional disparities.46% Decrease Avg. This was especially true in the main urban areas. Price drops in this new home sector. N° of IRELAND Residential Transactions 2009 vs 2008 Trend 2010 -42. Home Price/ Capital City -25. commonly referred to as the 'bungalow on the half acre' have dropped in price within a range of -27% to -45% with an average price drop off peak 2006 prices of 37%.European Residential Real Estate Market Trends 2010 ERA Ireland Further declines in both prices and transactions. ERA Europe © • www. 9. 42. The ERA Ireland survey which is representative of forty urban and rural markets in all counties in Ireland has thrown up some interesting variations" says Frank Doonan CEO of ERA Ireland. This reflects the fact that first time buyers with secure employment is the sector most likely to secure mortgage financing from the main Irish banks at present. For the moment. There are several locations in Ireland where there is less oversupply of good quality starter homes and therefore property prices have stabilized faster in these areas.com • All Rights Reserved • June 2010 • Page 27 of 51 . In quarter four of 2009.46% fewer than in 2008. The lesson to be learned for property sellers and buyers alike is to think local when valuing an individual property.818 residential mortgages were drawn down in 2009.946 mortgages were drawn down which was 18.4% fewer mortgages when compared with the previous quarter. range from -33% to -50% and an average decline off peak* of 40%. A total of 45. Suburban bungalows on their own site have suffered smallest price decreases with some areas reporting a 27% price decrease from peak. this trend change will lead to a reduction in the number of moves a person makes in their early life stage. Home Price/ Nationally -20. Because of the density of apartment developments many areas have gross oversupply relative to demand. Many previous buyers of such apartments can now afford to buy a two or three bedroom house in the area of their choice. The first time buyer sector experienced the lowest decline in the fourth quarter of 2009 with 3. Price drops in the apartment sector range from -33% to -60% and an average decline off peak of 46% One off properties in the country.4% fewer than in the third quarter. Generally where demand exists at present it is for three and four bedroom second hand homes. Apartments in secondary locations are the least sought after property type at present. "It is unhelpful to speak of average property market prices as if there were just one national residential property market. Transactions The most reliable method of tracking property transaction numbers can be observed from the Irish Banking Federation (IBF) quarterly report on residential mortgage drawdowns.22% Increase 1.05% Increase N/A Decrease A recent survey of ERA Estate Agents across Ireland shows up some interesting residential property price trends.

4% since their peak in 2006.2%.ie property barometer indices. The asking prices for second hand homes fell by 3.European Residential Real Estate Market Trends 2010 Mortgage loans totaling € 8. Due to the crash in Irish property prices the Irish banking sector is in deep distress with the Irish government having to guarantee all banking activity and relieve the major banks of billions of toxic loans lent into the sector throughout the Celtic tiger property price bubble. we will begin to see residential property transaction levels rebound during 2011. Outlook Autumn 2010 and beyond Asking prices for properties across Ireland have continued to fall.865 in quarter four of 2009. “There has been a three fold increase in sale agreed properties in Dublin compared to the same period last year. Asking prices nationally fell by 3. Asking prices in the capital have now fallen by 33. and the recapitalized banks get back to prudent lending to the sector. Source: myhome. It is also interesting to note that three quarters of first time buyers are looking to purchase a second hand property while one in five is seeking a newly built home.076 million were issued in 2009. First time buyer average loan volume peaked in quarter one of 2008 at € 251.com www.9% in the first quarter of 2010 bringing the total fall over the last 12 months to 15.com • All Rights Reserved • June 2010 • Page 28 of 51 . There is hope that as property prices bottom out at roughly 50% off peak. Nearly half of the first time buyers have a preference for a semi-detached home while 10% prefer an apartment.eraireland.2%. Commenting on the results.3% in the first quarter of 2010 compared to a fall of -3. independent economist Paul Murgatroyd said the -3. which is encouraging.ie ERA IRELAND Dublin. “Asking prices have continued to fall as have actual sales with plentiful anecdotal evidence showing peak to trough declines in sales prices in the order of 40 to 50% depending on property type and location. This is being managed by the newly created National Asset Management Agency (NAMA). The most notable exception was Dublin City South where the average asking price rose by 1. the smallest decrease in percentage of any sector covered. This was the largest decrease on any of the MyHome. In Dublin asking prices fell by 3.com ERA Europe © • www.831 and has dropped to €206.1%.4%. 65% less than in 2008.eraeurope.5% in the last quarter of 2009. New homes recorded the largest drop in asking prices in quarter one. Irish tax payers now foot the bill for massive developer loan write offs and the Irish government is forced to recapitalize the banking sector on taxpayers’ behalf. Ireland Tel: +353 1 89 01 722 Fax: +353 1 89 01 723 info@eraireland. however. the rate of decrease in asking prices has eased for the second successive quarter.13% recorded over the same period in 2009. Actual sales prices have on average decreased by 40%+ since peak in 2006. declining by 4.3% rate of decrease in quarter one was significantly lower than the -6.

2010 is showing slight indications of a comeback. dropping to a total of €109 billion. Home Price/ Nationally N/A not available Mortgage Rates Number of Brokers Total N° of Broker Offices -9. In some countries where prices dropped.1% in the average price of a home in 2009.2%.5% Increase -1.347. From the end of 2006 when the market was at maximum expansion to today. Prices and Transactions The volume of investment in construction fell 9. began declining during the second half of 2008 in tandem with the fall of Lehman Brothers. the total value of real estate transactions between 2008 and 2009 decreased by 18. Research firm. The data regarding the abundant supply and the scarce demand shows however. in part due to a decrease in the quantity of transactions as opposed to prices.eraeurope. dropping to €143 billion after having peaked in 2007 at more than €152 billion.20% Decrease -7. financial and real estate crisis that began in mid 2007 seems to have bottomed out for Italy during the first half of 2009. at which time there was also an increase in yield. albeit in a limited manner.10% Decrease Avg. in 2010 prices still appear to be declining. by a panel of real estate experts from the 13 main cities. a loss of € 24 billion. If the economies of countries such as the US. Meanwhile. services. Home Price/ Capital City -4. In recent months however.1%. as was the case during the final semester of 2009. the economic crisis has been relatively contained in Italy and more connected to the macroeconomic weakness of the country as opposed to the so-called housing bubble. whereas in Italy the demand remains weak and prices are not yet showing signs of growth.28% Decrease Avg. The last semester indicated a slowdown in the pace of decrease in prices that could be indicative of a comeback. Data regarding these positive market trends has been confirmed in a preliminary survey held in March 2010. home values decline 4. the opposite can be said for Italy.Dwellings in prestigious tourist locations with strong appeal On the other hand. After the economic difficulties experienced between September 2008 and April 2009. They agree that house prices are not rising due to the fact that supply still largely exceeds the level of demand. some countries are already showing clear signs of recovery with consistent increases in volume as well as in prices in significant sectors of the European real estate market. from 1.4% in 2009. Therefore. where the weakness of the macro-economic situation was the principle factor in the deterioration of the real estate market.1% nationally in 2009. in the city centre or in buildings with a high architectural quality . Compared to other countries such as the United States and Spain. green space. an active market for the following categories: .Dwellings in energy efficient buildings that are well situated and that offer parking.52% Decrease Buyer or Seller Market Buyer Buyer Average Days on Market 72. . the demand has already retur ned significantly.709.176 to 1. the market is particularly weak if not completely absent for: ERA Europe © • www. Spain and the UK were weakened as a result of financial problems originating in the real estate sector.Dwellings in prestigious buildings in prestigious locations. no signs of price growth in the short term   N° of ITALY Residential Transactions 2009 vs 2008 Trend 2010 -11.com • All Rights Reserved • 1 June 2010 • Page 29 of 51 . Nomisa’s last market survey of the 13 largest Italian cities revealed a negative variation of 4. the total number of real estate transactions has dropped 21. Real estate values including home prices. it has been noted that global macro-economic trends seem to be heading in a positive direction.European Residential Real Estate Market Trends 2010 ERA Italy Demand remains week.368.41% Decrease General The deep global economic. The effects of the improved real estate market overview are still rather weak in Italy. Although values still remain much lower than a few years ago. etc.

returning to well under pre-crisis average amounts.Low quality dwellings normally in buildings poorly situated and in the outskirts . the important drop in interest rates for new mortgages helped sustain the demand for dwellings. from € 821 to €704 per month.European Residential Real Estate Market Trends 2010 .eraitaly. only 205.000 were purchased with a mortgage and at an average value of just under €130. from 271. Of the 609.com www.Developments with low architectural and construction quality and low energy efficiency Mortgages In 2009.000. these actually decreased by 10.000 homes bought in 2009.com ERA Europe © • www.000 in 2008 to 242.eraeurope. Lower mortgages rates in 2009 however. ERA ITALY Milan. Italy Tel: +39 02 393 59 491 Fax: +39 02 393 59 441 info@eraitaly.Buildings located in not particularly prestigious tourist areas in a poor environment . were not enough to sustain the total number of mortgages closed during the year.000 in 2009. The typical average monthly mortgage payment fell by 15%.com • All Rights Reserved • 1 June 2010 • Page 30 of 51 .7%.

These programs have a clear social purpose. home values drop nationally by 10.e. Fixed rates are not typically used in Luxembourg. Population tendencies are increasingly toward moving to urban areas.6%. but remain concerned about valuations. Though many sellers are still slow to adjust prices downward. So propagating the image of a real estate market that is overpriced (I. As financing becomes more difficult to access. Home Price/ Capital City -10.66% Unchanged Mortgage Rates Number of Brokers Total N° of Broker Offices -12. The only reason that might explain this approach is that the Government has its own real estate projects to sell. a truly motivated seller will in the end sell at market value. access to convenient transportation and the ease of getting to and from work have a significant impact on the choices people make on where to work and live. allows the Government to present a better price/quality ratio. This pricing disparity has also had a negative impact on transactions figures that have dramatically fallen these last 2 years. though demand for homes remain high. there is a clear difference between asking prices and the end price paid at the notary. as well as real prices paid by home buyers fell from 2007 to 2009. Once averaging 72% today homeownership is estimated at 67%. People who cannot afford buying at still relatively high prices opt now for renting solutions. signs of recovery on the 2010 horizon LUXEMBOURG N° of Residential Transactions -17.70% Unchanged -7. conversely the desire for higher priced areas and/or homes has waned. buyers are reassured in transacting real estate. Real Estate Offices There was most likely some attrition in the number of real estate offices last year. but due to the low interest rates. Nevertheless. With a more regulated real estate market.com • All Rights Reserved • June 2010 • Page 31 of 51 . and the need for buyers who dare to buy now (and it’s the best time to buy now) for security in the future. and they sell poorly.80% Decrease Avg. Prices and Transactions Transactions. Today. work facilities and/or general opportunities the city center of fer s.European Residential Real Estate Market Trends 2010 ERA Luxembourg Transactions down by 17%. however now we are seeing signs of a recovery.69% Decreased General Homeownership is slowly reversing course and moving downwards in Luxembourg. thereby confusing the public.29% Unchanged Avg. Home Price/ Nationally -10. On average a 25% minimum down payment is required together with and a good salary and employment history. mixing asking price statistics and the real prices paid to the notaries. too expensive). Demand remains healthy. the rate remains comparatively higher than in neighboring European countries.67% Increased 2009 vs 2008 Trend 2010 0. Outlook 2010 The market clearly experienced a slow down between 2007 and 2009. demand for apartments or smaller properties has increased. especially given the constant need for homes and the fact that many investors choose real estate as an alternative to banks and/or stock market investments. Mortgages Though local retail banks are offering mortgage loans at historically low interest rates. but there are still a high number of agencies and agents on the market to sell the properties offered on the market.eraeurope. due to the high concentration of jobs. With an uncertainty about the future buyers remain conservative and will only pay real market value and no goodwill. As long as the Government of Luxembourg Government continues to provide statistics that make buyers feel that the market is overpriced. Second-hand homes sell better and faster than new ERA Europe © • www. as a result many more banks now offer attractive fixed rate loans for periods up to 20 years. Unfortunately the Government publishes figures. loans are still difficult to obtain if the buyer does not have a significant down payment. due to the ongoing difficult economic situation. Buyers simply will not purchase at asking prices they feel are over valued nor will banks finance these properties.50% Decreased Buyer or Seller Market Buyer Buyer Average Days on Market 16. So. many buyers will not feel comfortable in buying.

European Residential Real Estate Market Trends 2010 properties. 2010 will bring an increase in real estate investments (and home rentals) with a tendency toward a stabilizing market after the serious market corrections during 2008 and 2009.eraeurope. because their purchase costs were much too high and in doing so would lose money.com www. Most developers are having serious problems to lower their prices.com • All Rights Reserved • June 2010 • Page 32 of 51 . as the latter are comparatively higher priced.eraluxembourg.com ERA Europe © • www. ERA LUXEMBOURG Luxembourg Tel: +352 40 38 981 Fax: +352 40 37 9750 info@eraluxembourg.

There is only one option for these homes: lower their price until homebuyers do respond. ERA Europe © • www. Again. The allegedly fixed in stone tax deduction amenity for paid interest on home mortgages. In some regions the number of transactions seemed to increase gradually. Financing homes was definitely not their top priority. the government would subsidize homebuyers in the lower segments. Due to the economic stagnation.com • All Rights Reserved • June 2010 • Page 33 of 51 . More recent listings sell faster and are less difficult because of a more realistic asking price.60% Decreased -44. Unfortunately banks were not very keen on supplying mortgages.69% Decrease Avg. Offices nowadays are often half the size in man power compared to their size before the crisis. That was when the housing market seemed to almost reach a complete standstill overnight. Home Price/ Capital City -6. the Dutch government collapsed. Hence. Banks were in dire need of government support to survive their own internal crises.08% Decrease Avg.000 less risky for banks. Listing inventories have doubled. During the years before the crisis young newcomers in the market without capital had almost no chance at all to afford and finance a home. Furthermore.41% Decrease Mortgage Rates Number of Brokers Total N° of Broker Offices Buyer or Seller Market Buyer Buyer Average Days on Market 37. Home Price/ Nationally -7. The real estate agents were agonizing how long this total lack of showings and sales would last. until April of this year. However a buyer does not care what amount of money the seller needs. and did nothing in the meantime. has come under siege. During the year the Dutch market showed an unstable pattern of occasional recovery and relapse into inertia. That made buying a home up to €350.eraeurope. the NHG (Dutch Mortgage Guarantee Fund). Therefore this opportunity was not the huge dreamed of success. The real estate offices have had to downsize as much as they could.18% Increase -0. for many people their stepping stone to owning their home. That has created huge uncertainties with potential homebuyers. They were missing 6% on every transaction on taxes and they needed the tax income. Combined with the buying subsidy this would be a golden opportunity for newcomers to finally be able to buy their first home. The average transaction numbers do not say much. There is a contrast between older and recent inventory. The government realized that it had to act. buying a home was not an easy thing to do neither during this quarter nor during the early months of 2009. who needed to sell their homes. Consumers would get a discount on their mortgage rate in return. should they sell their home for a realistic amount. These people are neither willing nor able to lower their asking price. while they were still working on their internal troubles.33% Decreased During the last quarter of 2008 the real estate market changed in the Netherlands. One of the symptoms of the economic crisis was a huge listing inventory and a subsequent sharp decrease in home prices. Everyone held their breath: sellers. heavy cuts on government expenses will be necessary. Due to the over-financing in the past.44% Decreased -33. a certain number of these sellers are faced with a huge debt. People are waiting to see what the elections in June might bring. A new parliament will be elected in June of 2010. Homebuyers were waiting for the economy to recover. They had to make sure that homebuyers would get some sort of compensation for the risk they were taking when buying a home. and hence do not attract any attention from homebuyers. in most cases. and how long they would last during this situation. He just wants to pay the lowest possible price for a home. A section of a real estate office’s inventory was listed quite a while ago for asking prices which today are no longer realistic.European Residential Real Estate Market Trends 2010 ERA Netherlands A search for new balance in the Dutch housing market N° of Netherlands Residential Transactions 2009 vs 2008 Trend 2010 -30. showings have decreased severely. At that point in time. were wondering how much they would have to lower their asking price. Until then they are quite reluctant to buy a home with the risk of not being able to afford it. Therefore they stretched the criteria for a mortgage guarantee.

if they cannot be retracted from the market.nl ERA Europe © • www.com • All Rights Reserved • June 2010 • Page 34 of 51 .era.European Residential Real Estate Market Trends 2010 Outlook The real estate market in 2010 will remain volatile. The Netherlands Tel: +31 30 289 9900 Fax: +31 30 287 1109 era@era.nl www.eraeurope. as a result of local political and economic instability. Price corrections will remain necessary for older listings. ERA NETHERLANDS Utrecht.

Data relating to new build activity is at its lowest levels in the past 15 years. transactions and prices down. The 2008 financial crisis further exacerbated this trend and has contributed to a more severe retraction of the economy in 2009.000 properties less sold in the Portuguese market. market specialists estimate an additional reduction of 14.526 million in 2008 to €9. The 1st  semester 2009 reflected declines across the board with the largest fall occurring in the 1st  quarter. meaning 37.000 unemployed people. The percentage of decline was not uniform over the entire nation. as well as their future expectations. Historically attractive to British investors. The current situation offers very attractive buying and investment opportunities in 2010.eraeurope. although a growing supply versus demand adjustment was verified during the last year. 2010 pace more positive N° of PORTUGAL Residential Transactions 2009 vs 2008 Trend 2010 -13. Transactions Concerning the number of properties sold in Portugal.11% Decrease -2. Buyers are experiencing greater difficulties in obtaining mortgages as restrictions are tighter and loan to values increased. Construction licenses issued in the residential sector reached a total of 45.26% Decrease Buyer or Seller Market Buyer Buyer Average Days on Market -11. Home Price/ Capital City -24. +1. A slight negative growth rate of square meter (m2) average price in housing in 2009 was verified in most of the quarters along the year (. 5% for new mortgages). Home Price/ Nationally -4. a decrease was verified in 2008 compared to 2007.   Prices Unlike in other European countries. A reversal of this trend began in June.7% in Q2. Despite the lack of official figures for 2009. .35% Unchanged Mortgage Rates Number of Brokers Total N° of Broker Offices -1.  ERA Europe © • www. The crisis also had a negative impact on Portuguese families’ income and wealth. or a 10% unemployment rate. The Portuguese official source (INE).0. structural economic weaknesses were exposed within the country.  Mortgages With the Euribor currently at 1% (and average spreads of 1.9% in Q4).  By the end of the year mortgage loans continued an upward growth trend.6% versus 2008). and a deceleration as well in demand. .000 properties sold in 2009).3% in Q3. In year 2009 there was an additional reduction of 21% in approved construction licenses. resulting in a hastening of both investment and consumption. Due to its high degree of exposure and indebtedness level.00% Decrease Avg. this was reflected in a GDP decrease of 2. the speculative bubble in real estate was not strongly noticed in Portugal.5% in 2009 (after a 0. Regions where residential construction associated with tourism were most dense such as Madeira Autonomous Region and South of the continental territory (Alentejo and Algarve) were the regions contributing most to the decline.  Mortgaged loans issued declined 31% in 2009 versus 2008 (from € 13. the economy was adversely affected.3% in Q1.000 properties sold (meaning roughly 150.26% Decrease General The Portuguese economy slowed in 2009 a shift that began toward the end of 2006 in other main European economies.330 million in 2009).com • All Rights Reserved • June 2010 • Page 35 of 51 .0.00% Decrease -1.59% Decrease Avg. with a slight average price decrease in 2009 (-2.European Residential Real Estate Market Perspectives 2010 ERA Portugal New building activity at its lowest point in 15 years. states in 2008 the number of properties sold in Portugal declined by 18%. As a result of convergence of this international financial crisis with general global economic woes. the Algarve region suffered particularly from the pound devaluation versus the euro currency (roughly 30% devaluation since the start of 2008). the average interest rate for Portuguese families in 2009 was roughly 3%.0.3% growth in 2008). By the end of 2009 there were nearly 500. Main indicators of Portuguese real estate market in 2009 show a downward correction in supply that had already commenced in 2003.400 representing a 30% decrease versus 2008. from an average of 90% to 80%.

Recovery of residential market growth. . design and environmental efficiency. construction quality. after the rating agencies’ (Standard & Poor’s. the higher price Portuguese banks will pay to obtain credit abroad. although not yet sustainable.Increase in quality of delivery of new services by real estate agencies. and the senior residential market. Setubal peninsula. . architecture.  An important factor that still needs to be clarified is the impact on interest rate spreads (given by banks to property buyers). downward adjustment of sales prices and more fierce competition from the financial institutions) may however in the short terms lead to a recovery. Trends . in light of demand from new market segments including the senior market and individuals living alone (including divorced people). of the buying and selling process.Growth in higher quality project developments of resorts.com • All Rights Reserved • June 2010 • Page 36 of 51 . in transactions and mortgage loans.era. . The higher the risk perception of the Portuguese economy. the residential stock will remain high as there continues to be persistently weak demand. due to the sector higher professionalism and the private clients’ growing need to search the real estate services to sell their houses.   .Urban rehabilitation: implementation of public space improvement and historic centers. increased demand for housing in the rental market.     .pt www. Moody's Investor Service and Fitch Ratings) gave recent negative assessments of the financial risk of the Portuguese economy.Consolidation of real estate businesses into main real estate networks. Portugal Tel: + 351 213 600 150 Fax: +351 213 600 159 info@era. to continue to attract residential tourism.European Residential Real Estate Market Perspectives 2010 The indebtedness of the Portuguese families has reached a historic maximum of 134% of the total available income. The convergence of three factors (low interest rates. Outlook 2010 Despite the decline in construction licenses issued and in completed conventional dwellings. Alentejo and West sea coast). And. golf courses and SPA’s (Algarve. the more expensive the Portuguese banks will have to pay for their funding operations in other markets.eraeurope.pt ERA Europe © • www. the more they will have to increase the spreads of mortgages approved to people willing to purchase a house in Portugal.   Tighter restrictions on mortgage lending practices due to a growing risk of non-payment issues.Real estate product differentiation based on factors such as location. at a slower and more selective rhythm. .Growing level of real estate industry market share. ERA PORTUGAL Lisbon. This clearly has potential to have a further negative influence on an already fragile housing market.

This is 15% less on average. As many as 15. 52. 2010 shows a continued downward price trend. according to the National Statistics Institute (INS). With the decrease in the number of transactions many small real estate agencies withdrew from the real estate market. middle class and foreign investors. only 125 generated more than € 10. not all residential prices experienced a drop in Bucharest. Competition in the residential construction market is getting tougher. According to statistics its volume is estimated at about 8. In 2008.5% (30 Oct 2009 / 30 Oct 2008). 2009 was a year of market corrections and stricter mortgage requirements. reaching 23. the price correction was partially consumed by the currency fluctuations.67% Decrease Avg.0% Unchanged 0.000 dwellings. the year 2009 saw a visible price correction downward. As prices are quoted in Euros. Home Price/ Capital City -16.000 inhabitants.000 flats and houses. In 2009 around 52% of the units were delivered in the cities. Nearly 55% of Romania’s housing stock is located in urban areas.European Residential Real Estate Market Trends 2010 ERA Romania Prices drop by 19% on average.000 in turnover and had more than four employees. The market for smaller residential projects and re-sale property is governed by mid to small-size real estate agencies.200 per M2. if we look at the Euro prices during that period of time. which roughly translates to 384 units per 1. A good signal is the clearly reduced number of available stock of unsold apartments. The 2009 end of year analysis shows reduction in prices of new apartments by 19%. comparable to the price decrease registered for second-hand units which ERA Europe © • www. primarily due to bad media and tighter bank polices for mortgages.260 per M2 of built area. The appreciation of this currency versus the RON can be estimated at 18. The average asking price of residential space in Bucharest came to a net of approximately of € 1. The number of housing units delivered in the first six months of 2009 went up by 1.8% of the delivered dwellings were built in the rural areas. Investment fear persists though.000 units in Bucharest in 2009. -28% drop in transactions.eraeurope. Prices After the spectacular price growth in 2007 and stabilization in 2008. targeting middle to high quality offers. and most of it represents blocks of flats made of prefabricated concrete slabs built in the socialist era. The prices of currently listed new dwellings generally range between € 900 and €1. The quality of the housing stock is very low throughout the country. with approximately 60% of the entire supply below the market average. In reality. The decrease in prices was mostly noticed in flats located in the old communist buildings and in certain locations far from the central Bucharest. only 1.60% Increase N/A N/A General The Romanian residential market is characterized by relatively high number of homeowners (97%). with larger projects and more offers.270. market conditions have been slowly stabilizing from a developer’s point of view. The level of price correction in real prices does not seem extremely high. out of this number. At the end of Q3 2009. Compared to 2008 situation. Demand for residential property comes mainly from the new upper class. some of them for good while others intend to so only temporarily.700 companies were engaged in real estate activities in Romania at the start of 2008 in addition to the leading top-20 companies. However. Home Price/ Nationally N/A Decrease Mortgage Rates Number of Brokers Total N° of Broker Offices N/A N/A Buyer or Seller Market Buyer Buyer Average Days on Market 0. N° of ROMANIA Residential Transactions 2009 vs 2008 Trend 2010 -27. but fewer buyers.700 real estate agencies.248 units against the first six months of 2008. compared to the third quarter of 2008. developers still declared their readiness to deliver a record-breaking number of more than 3. while the remaining 48% were built in the rural areas. From these 1.com • All Rights Reserved • June 2010 • Page 37 of 51 . which are difficult to find in the market.18% Decrease Avg.700 had real estate as their main business activity. though the price reductions have not resulted in a satisfactory pick up in sales as expected by developers.

Constanta is located in the southeast area of Romania’s Black Sea coast.5% lower for the old ones (€1. Consequently. the residential market in Bucharest also dictates price drops. The average price for resale houses is € 913 per M2 and € 1.031 per M2. but were flexible when negotiating with clients.eraeurope. Real Estate Transactions According to the National Union of Notaries Public in Romania. the number of transactions involving housing and land dropped 28% in 2009. Still. A higher price level of between € 1. the average price for second-hand flats dropped by 5% over the same period.1% to €1.500 per M2. One of the main sources of income driving the development of this city is tourism. Therefore. compared to 2008.700 per M2 was requested for projects located in secondary areas. In some cases price decreases were spurred by the competition between developers and the investors who purchased apartments off-plan during 2007-2008 and later offered them for sale. Cluj Napoca is the third largest city in Romania.506€ per M2) and 12. while the other cities remain quite ‘undiscovered’. prices surpass the second ranking city. developers offer a variety of incentives such as: fully furnished and equipped kitchens. The average price for a new dwellings closed the year at €1. the effective price for a closed transaction may be 10 to 15% less. Price policies were not uniform. Moreover. when compared to 2008. In Bucharest.European Residential Real Estate Market Trends 2010 was 20%. Cluj-Napoca. the constant price level was determined by several other factors: the contracts signed with banks for the project financing. Among the big cities.300 per M2 (without VAT). parking spaces. as they benefited from several competitive advantages compared with the ones listed at a price lower than €1. low competition between projects located in central and secondary areas.9% lower for the new houses (€1. Cluj-Napoca’s residential market experienced the beginning of a construction boom in 2003. Developers also had flexibility when it came to pricing of their units. storage rooms or discounts for a limited number of units.022 per M2 for new homes. The real estate market in Bucharest continues to be the most expensive nationwide. Most developers preferred to maintain high asking prices.3% to €1. Constanta (south-eastern Romania). Constanta is one of Romania’s largest cities with a population surpassing 300. a 19% drop from December 2008 levels. The price per M2 of used area in Bucharest (IMO index) registered in March 2010 was 11. the price decrease doubled when allowing for adaptations. as the market does not allow for expected profit margins at this time. From March 2009 to March 2010. investors prefer to rent the apartments until a future market recovery. Hot Spots The city of Bucharest attracts most of the investors. The average price continued to decrease in Bucharest for both new houses and older flats in 2010. New construction in the capital is 42% more expensive than in the second ranking city. Additionally. Attractive working opportunities created by Romanians and foreign investors who launch businesses in Bucharest will attract an increasing number of people to the capital city. price levels are permanently ahead of other big cities. Brasov and Craiova.000. Iasi. On the other hand.200 residential units per year compared to 200 units in earlier years. After over a decade of continuing stagnation in housing construction. Even in the context of a very slow selling rhythm. According to the estimates.1%. pressure from clients who had already purchased properties at a higher price within the same complex. Cluj-Napoca is the only big city in Romania where the prices for new constructions increased at the beginning of 2010. Bucharest may double its population in the next 10 to 15 years to over 4 million inhabitants. Early in 2008. Constanta’s real estate market is driven by demand for holiday homes and from investors hoping to get a share of the income generated from the growing tourism industry. Other major cities with an active real estate market are: Constanta. Iasi (eastern Romania) is currently the cheapest city in the large Romanian cities group. The prices for apartments targeting the medium and upper-medium segments of the market varied between €1.058 per M2 while the average for the old houses dropped by 20. developers opted to maintain a stable pricing policy for projects with attractive price/quality ratios or that were located in prime residential areas. some developers/ investors maintained the same price levels in 2009 or just slightly decreased them with no more than 10%. notaries had estimated a drop of at least 40 to 50% in 2009 real estate transactions taking into account signals of the market situation and the ERA Europe © • www. The total output was brought to a level of 900 to 1.241€ per M2). such as renting the apartment with an option to buy at a later point in time or offering alternative payment methods to temporarily avoid bank financing. Because of its attractive location.500 per M2 . down to 353. the average price for the new houses dropped by 13.000 transactions. Constanta has the highest price decrease for houses. with apartments located in peripheral areas at the lower end of this range. When it comes to retail homes. Timisoara. as they could personalize offers according to each client's payment capacity.100 and €1. thus. contributing to an annual increase (March 2009 to March 2010) of 5.com • All Rights Reserved • June 2010 • Page 38 of 51 .500 and €1. Cluj-Napoca (central Romania) by 19%.

300 apartments were sold during 2009 (in apartment complexes with over 200 units). 2012). Romanian housing market transaction volumes  were down 92%.com • All Rights Reserved • June 2010 • Page 39 of 51 . It is likely that there will be further changes to the real estate laws in Romania. a 63% contraction compared to the year before. when Romania joined the European Union. are very strict which caused the numbers of approved loans to decrease considerably during the year. the decrease in prices quoted in Euros was tempered or even cancelled out in some cases. starting with January 1st. with a peak of 4. New Developments Before the accession of Romania into the European Union there were a number of strict rules that prevented foreign investors. In the second half of 2009. from €815 million for the first half of 2008 to just €62 million for the same period of 2009. an improvement in housing demand might be expected in early 2011. Between January and June 2009 the exchange rate varied between 4. The first half of the year started with three months of virtual deadlock that ended with total sales of 515 units.Land used for secondary residences or for secondary headquarters after a 5-year term from the accession of Romania into the EU (i. the commercial property rental market dropped 60%. EU persons: Citizens of EU member states. In the first semester of 2009. At that same time. However. when the RON/Euro exchange rate was 3. the annual average interest rate for mortgage loans was 11.e. Outlook Limited accessibility of mortgage loans will keep the sales pace rather low. at the end of the first half of 2009. When compared with the same period of the year before (2008) the increase in interest rate levels was significant. The entry of Romania into the EU in 2007 is the primary reason why the Romanian government is likely to set upon a course to liberalize the real estate laws and Constitutional provisions. Non-EU persons: Citizens. In spite of this. with a peak recorded in January 2009. However.000. EU persons can purchase land in Romania under the following conditions: . Since 1 January 2007. under a reciprocity basis. The conditions that ordinary people have to meet to qualify for a mortgage (or other loan). demand was supported by the governmental program “First House”. The applicable law divides the foreign investors in two main categories: 1. A significant negative effect on the sales rhythm was induced by the RON/Euro depreciation. Non-EU persons may purchase land in Romania under the conditions of international treaties between Romania and the states of origin of the buyers.Agricultural land and forest land 7-years term from the accession of Romania to the EU (i.  In total. Assuming the economic slowdown will last for another two years in Romania. Mortgage interest rates in Romania are dramatically higher when compared to other European countries. these rules have been adapted. Most of these changes will need to integrated into the Romanian Constitution as well.European Residential Real Estate Market Trends 2010 developments in the industry during the first month of the year. The Romanian government set up a national property registry office.e. Demand behaved differently throughout the year. The property tax system is now also being restructured with the introduction of a new property tax of 2 to 3% depending on the value. According to the National Bank of Romania. Compared to June 2008. to purchase land in Romania. the program only influenced sales activity in the projects with price reductions and offered apartments in the limited range of € 60. legal persons incorporated in the EU member states and stateless people domiciled in an EU member state. 2010 should bring a slight improvement both in the number of new loans and the number of units sold. foreign investors are now allowed to purchase land under certain conditions.02 and 4.64%. Because of the depreciation of the national currency. starting with January 1st. the depreciation was significant.20 RON/Euro.eraeurope. This was reflected in the total volume of credit granted for residential acquisitions. This shall eventually result in the stabilization of prices.89% for loans granted in RON and 9% for Euro loans. Bucharest’s demography shall be perceived as a fundamental factor with positive influence on the ERA Europe © • www. 2.31 RON/Euro registered in the first quarter. price and year the property was built. legal persons and stateless people not from an EU member state. . the reduction in end-users’ demand was 50% in 2009. driven by projects that accepted the new market conditions by offering lower prices and favorable methods of payment. Putting aside investors’ share in demand (which accounted for 30% of the total sales in 2008). Demand from investors from abroad is low. approximately 1. 2014). an additional 800 units were sold in the second half of the year. Mortgages High financing costs drastically restricted the number of clients eligible for mortgage loans.

Thus. It may take up a year until a new offer will finally meet the local buyer requirements and consumers buying power capacities. qualifies the residential market in Bucharest as oversupplied at the moment. but at a slower pace. will not turn into an immediate increase of transactions in 2010.eraeurope.com www. ERA ROMANIA Bucharest.000 unsold units at the end of 2009. The standstill. Over the short term (2010).eraromania. Prices are expected to continue a declining trend. which resulted from a lower residential lending volume in 2009. it’s evident Bucharest lags significantly behind in stock per capita basis. over the medium to long term. 2010 will follow a similar pattern as the previous year: supply levels will show very little change. However. real demand will greatly depend on the “First House” program and any new governmental initiatives (e.g. Most likely. Romania Tel: + 359 888 25 83 94 Fax: + 359 887 94 2217 info@eraromania.: 5% VAT for all new apartments regardless of price and size).com • All Rights Reserved • June 2010 • Page 40 of 51 .European Residential Real Estate Market Trends 2010 development of the primary residential market in the long-term. when comparing the stock of new apartments in Bucharest to other capital cities in east and central Europe.com ERA Europe © • www. The 9. we believe that Bucharest’s residential market has great potential for further development. demand will depend greatly on governmental initiatives and end-user confidence. However. its current impact seems to be hampered by the general economic situation.

76% -3. outlook positive N° of SWEDEN Residential Transactions 2009 vs 2008 6. This forecast brings positive energy to households in Sweden and many more real estate transactions are expected to occur in 2010 compared to last year.com • All Rights Reserved • June 2010 • Page 41 of 51 .08% Buyer or Seller Market Seller/ Buyer Seller/ Buyer Average Days on Market -4.38% year on year increase. Low mortgage interest rates and taxes have played a significant role in the high level of homeownership. Despite troubled times in Europe. Of the reconstituted apartments are 94% located in metropolitan areas and 74% in Stockholm. Statistic shows that using a broker results in an 18% higher sales price. Last year the number of households was 4. will nearly bring balance to the Swedish economy as early as next year. due to anxiety over the financial crisis which began in fall 2008. The majority of Swedes live in owner occupied dwellings. These advantages have driven smaller agencies together and to collaborate in a quest to become more cost efficient to better compete.00% Mortgage Rates Number of Brokers Total N° of Broker Offices 4.487 closed transactions previous year (2008) a 6. and +13% in the capital city of Stockholm. with substantial surpluses expected further ahead. In Stockholm the number is as high as 92%. ERA Europe © • www.500 broker offices. The offices are divided between about 1000 owners/entrepreneurs. Internet is the major marketing channel when selling or buying a property in Sweden.380 in 2007). The propensities to own a home together with financial incentives and benefits have been the major factors to the high percentage of homeowners. The Swedish capital of Stockholm contributes around 42% of the total sales revenue but only 26% of the total numbers of real estate transactions. In real estate. but due to the low mortgage interests at the moment. a condominium conversion or condo conversion is the process of entitling an income property held under one title to convert from sole ownership of the entire property (which often already is a multi unit property) into individually sold units as condominiums. also younger people can afford to buy their own place to an ever increasing extent.European Residential Real Estate Market Trends 2010 ERA Sweden Average national increase in prices + 9%.97 individuals.025 and has risen to 4. This allows for both marketing and cost efficiency advantages. The rate of homeownership for 2009 has increased to 75% compared to 74% in 2008. The last few years we have also seen increased interest in buying a home through a condominium conversion.hemnet. The number of real estate agents was 6.032 by year 2009.447.se. Home Price/ Nationally 0. an economic recovery. The outlook for the central government budget and public finances though is favorable. 86% of house sellers and buyers use a registered broker when trading homes.555. The number of properties on the Internet is at the moment around 1600.03% Avg.65% 2. Real Estate Transactions The number of closed transactions in 2009 was 166. Twothirds of all agencies have 2 or less people employed. Home Price/ Capital City 0. Approximately 90% of apartments involve a trade through the internet.eraeurope. The most common site is www.469 compared to 156.06% Trend 2010 Increase Increase Increase Increase Increase Unchanged Unchanged General 2009 has been a rather rough year for brokers in Sweden.432 in 2009 (6. These agents were spread over 2. Such entitlement is generally derived from approvals granted by state/provincial and/or local municipal authorities (and often other relevant agencies. such as conservation authorities). The 10 largest real estate agencies have between 20 and 80 employees. The average age of a homeowner/buyer is between 45 to 65 years old. Recent trends show major agencies taking a larger share of the total market. together with currently sound finances.38% Avg. On average. The average persons per households are 1.

ERA Sweden has recently launched its own house mortgage.February 2010 compared with December 2008 . “ERA house-mortgage” is predicted to give substantial competitive advantages.February 2009. House prices during the last 12 month period on average nationally: . Summary 2010 is a year of hope for agents and brokers in Sweden. it is more common to fix the rate for a shorter period such as 2 years.com • All Rights Reserved • June 2010 • Page 42 of 51 . Prices Because of the economic situation.100 (2 million SEK).199 in 2008. If we look back on progress on an annual basis. may contribute to a positive trend in the future. the lowest rate since a very long time. typically one can choose between fixed and variable rate. Forecasts indicate that the figures of new house construction during year 2010 will increase compared to 2009 when the numbers were extremely low. However. we see that the housing price increase all over Sweden. As a buyer. After the summer the prices started to rise again but moderately and more cautiously than in earlier periods. In 2010 we can see a more stabile market overall and the prices will probably continue to rise. The largest percentage change in Stockholm by 13%.95% of the purchase price from a reputed bank.10% and the variable rate 1. apartments with similar ownership as houses. The new ownership form. a 10 year fixed rate 5.and passed. The buyer is therefore often offered to borrow up to 90 . It is still a bit tougher for commercial properties.65% (April 2010). probably due to a more secure financial market.com ERA Europe © • www. a product which is unique on the Swedish market. the Swedish Central Bank decided to lower interest rates in the second half of 2008.Apartments increased: 16% . The average home in Stockholm was sold for €315. The average percentage lies somewhere between 1 and 2%. After several tough years we now see a brighter future with a more flexible housing market and increasing prices. Today. The normal range for a fixed rate loan is between 1 to 5 years but sometimes longer. Now buyers are available mainly for residential properties. The average price for a house in the country has now passed € 205. The price increase is 2% during the last three months (December-February) compared with the previous period (SeptemberNovember 2009). The current mortgage rate for a 5 year fixed rate is 4. The average price increase during the period is 9%. this is yet to be seen. December 2009 . Bank economists expect the Swedish Central Bank to raise prime lending rate to 2% by the end of 2010 and then another increase to 3% is anticipated by 2011. During the first half of 2009 Sweden was for the first time in a long time experiencing falling prices on the real estate market. The bottom of the Swedish property market has been reached .30%. Outlook/Trends 2010 Housing has been identified as a segment with good prospects in future years and is expected to have a relatively rapid recovery due to stable cash flows. The normal repayment period is between 30 to 50 years with almost no installments on the first mortgage loans. ERA SWEDEN Stockholm.com www.Houses increased: 10% Mortgages The average Swedish buyer has a good and stabile income situation. Sweden Tel: +46 8 442 88 80 Fax: +46 8 442 88 89 info@erasweden.European Residential Real Estate Market Trends 2010 For 2010 we see an increased number of properties for sale.eraeurope. compared to the last decade where a 7 year fixed rate loan was a more standard time frame.erasweden. For the balance one needs to either pay cash or offer other property as security.

18% Increase Mortgage Rates Number of Brokers Total N° of Broker Offices 40.com • All Rights Reserved • June 2010 • Page 43 of 51 .00% Increase Buyer or Seller Market Buyer Buyer Average Days on Market -15.34% YOY change and the price index for condominiums during the same period slightly rose by . This trend is decreasing again at a rapid pace. Prices There was a sideward trend in real estate prices from late 2008 through 2009. crisis free N° of Switzerland Residential Transactions 2009 vs 2008 Trend 2010 -9. There has been a partial loosing of qualifying criteria which normally requires a 20% down payment. According to a Swiss real estate index.000 CHF/M2 (Jura) and 11. Construction is primarily taking place in the two business regions of Zurich and Lake Geneva. there was no crisis at all. however if rates go up again.000 CHF/M2 in Zug and Geneva. condominiums “win”. The proportion of projects for apartment buildings (rental apartments) lies at 35%.000 persons.000 persons) 2009 still 65. In most cases the immigrants are highly educated and wealthy. Baselbiet and surrounding areas.000 to 9. There is a risk of a moderate slowdown should interest rates increase. The least attractive markets were found in the Seeland.000 CHF/M2 (Jura) and 8.000 CHF/M2 (Zug. In 2001 to 2006 it was in each case around 40. Rental apartments are in competition with condominiums. On average about 40. in tourist regions (Engadin). 2007) the pace of increase ranged between 10 and 15%. New figures from the SNB show: around 43% of the total Swiss private assets are invested in property.g. Transactions Construction activity has been robust for several years. The market receives its best demand through immigration: after the peak level of 2008 (net migration of around 100. When interest rates are low.000 new housing units are constructed annually. Hence. More than 90% of house transactions in the Geneva Canton were over 1 Million CHF and in Zurich 40%.90% Decrease 20. 5% load.09% Decrease Avg.00% Decrease -0. Mortgages Currently interest rates are low with variable rate mortgages since June 2009 at about 2. and payments being 33% of a wages. as was the case in 2008 when home prices peaked during the 3rd quarter. does not appear to be a problem as interest rates remain ERA Europe © • www. and are located primarily in the Gold Coast area namely (Pfannenstil). over a one year period prices rose at around 3%. The over all private real estate index for the first quarter 2010 showed a slight decline of 0. Average prices per M2 for a single family home range between 3. These newly constructed projects are generally absorbed without any problems (at most there are local exceptions). the vacancy rate in 2009 sunk further.315 billion CHF. the private house price index for the first quarter 2010 reflected an incremental drop of . while in previous years (e. Over 45% of all building permits were for condominiums. In 2009 there was a sharp increase in mortgage volumes at the cantonal and regional banks. The proportion of newly constructed private houses has been decreasing continually for years and is now below 25%. then there is a preference for rental apartments. sideward price movements. Many people wish to profit from the current low rates of interest.000. Condominium price averages per M2 were 2.04% YOY change.36%. This trend appears to be continuing into 2010. In contrast to other European countries. and sustaining current positive market tendencies on the short term. Hot spots remain in the Swiss market. Outlook In 2010 price developments are expected to continue their sidewards movement.European Residential Real Estate Market Trends 2010 ERA Switzerland Stabile housing market.74% There was a tendency towards longer-term mortgages until end of 2009.. Home Price/ Capital City N/A 0 Avg.00% Increase Overall the Swiss real estate market proved to be resilient in 2009. Home Price/ Nationally 3. Genva) resulting in an average price of 1 Million CHF. at the expense of the margins. then this began to shift. Private property assets for SNB as of the end of 2009 were 1.eraeurope.

An interest rate rise is inevitable. as there is far too much cheap money on the market and competitive pressures remain high. this would cause downward pressure on prices and weakened the market.Sustainability not a problem at present. as they have far too much cheap money and the market competition pressure is high . Switzerland Tel: +41 448 821 004 Fax: +41 448 821 005 info@eraswitzerland.Should rates rise to a level causing the stock of properties for sale to increase.com www.Risk exists that banks will revise their requirements downwards. Hence the warning from the Swiss National Bank and the tighter controls.com ERA Europe © • www. in the last analysis a dependency also on politics. given the number of short term mortgage agreements that are currently being issued . . .e. and the topic concerning termination of bilateral agreements) . as interest rates very lo . There is a risk that banks will revise their requirement downwards.com • All Rights Reserved • June 2010 • Page 44 of 51 .eraeurope. ERA SWITZERLAND Dübendorf.eraswitzerland.Strong dependency on the further development of immigration (i.A crucial question remains of how quickly interest rates will rise. bringing about the risk of sustainability (above all.European Residential Real Estate Market Trends 2010 attractive.

which lasted four consecutive quarters.229. the construction industry continued to diminish resulting in a period of decline lasting 8 quarters. number of residential transactions and mortgages was recorded. Although this decline slowed in the last quarter of 2009.687 while the total number of residential transactions for the remaining cities was 60. ERA Europe © • www.88% Decrease N/A Unchanged General Outlook After enjoying a growth of 27 quarters. The number of building licenses granted in the last quarter of 2009 peaked at a total of 186.50% Unchanged Avg.European Residential Real Estate Market Trends 2010 ERA Turkey After an extended period of growth. The total number of residential building permits for the last quarter of 2009 was 113. when compared to the third quarter. Revival of the market and transaction scores was notably higher outside the 3 major cities. Despite the growth in the economy. the Turkish economy experienced a decline. This period of contraction was an effect of the global economic crisis and lasted until the last quarter of 2009 when a growth of 6% was recorded. adding up to a total of 116. In the second quarter of 2009 the recorded decrease rate of the construction industry was 21%.992. these “other” cities experienced a higher number of transactions in 2009 if we look at the quarter to quarter results. The tendency is now a gradual but steady rise.254. Since then. Transactions The number of residential transactions has increased in the last quarter of 2009. The total number of residential transactions in Istanbul in the last quarter of 2009 was 25. Indications are that this expansion in the economy will continue. This could be considered a paradox as the latent demand for up to 7 million units to be built by 2015 remains presenting a significant challenge due to the mismatch between supply and demand. where the total number of licenses granted for each segment was below 100. This is an encouraging development when compared to the third quarter of 2009. though the indicators from the first quarter of 2010 have been rather diverse.eraeurope. Home Price/ Capital City N/A Decrease Avg. together with production and imports-exports industries are the steam engines of the Turkish market place. building permits. Forecasts predict 2010 to be a year of normalization and improvement for the real estate industry. Home Price/ Nationally N/A Decrease Mortgage Rates Number of Brokers Total N° of Broker Offices N/A Unchanged Buyer or Seller Market Buyer Unchanged Average Days on Market Unchanged Increase 11. Government incentives on deeds and registration taxes in the second quarter of 2009 have accelerated the number of transactions resulting in the highest number of transactions since the fourth quarter of 2007.com • All Rights Reserved • June 2010 • Page 45 of 51 . which indicates that this process of development will be extended over time. the industry was rather debilitated as the construction industry.542.549.000. the housing market takes a step back in 2009 N° of TURKEY Residential Transactions 2009 vs 2008 Trend 2010 24. This is considered a positive indicator of a revival in the market. In the last quarter of 2009 the rate of decrease of the real estate industry began to decelerate and an increase of granted residential building licenses. the growth tendency continued into the first quarter of 2010. The cumulative transactions number for the three major cities was 55. Compared to 2008. Economic indicators show that the real estate industry in Turkey reached its lowest point between the last quarter of 2009 and the first quarter of 2010.

In the final quarter of 2009 a modest increase was recorded. but this decreased again in the third quarter of the year. 0. in 2008.909 22. the mortgage volume is at €19 billion. In financial circles it is predicted that there will be an approximate 10% growth in mortgage volume this year to a total of €20. a decrease rate of 8. the general trend in residential rentals is decreasing prices due to residual stock.229 Istanbul 29. Residential sales prices have fluctuated throughout Turkey. 0. According to current legislation.542 Rentals Residential rental prices had also reached their lowest point in the first quarter of 2009.7 billion. Mortgages constitute 10. The rate of decrease in home prices for this same period in some of the major cities is: Istanbul -10.254 3 Major Cities 60.346 24. Currently. mortgages were consumed mainly for transfers and second hand homes rather than new structures due to diminishing interest rates. only banks are permitted to issue mortgages. Five years later.83%.55% Adana +0. residential real estate buying tendencies of consumers contracted with the effect of the global crisis in the first quarter of 2009.385 53. Ankara -11.com www.068 102. Istanbul +0.3%.48%. As of February 2010 buying tendencies have slightly diminished yet again adding to the ongoing fluctuating rates.06% compared to February 2009.000 for the whole country. predictions are that the total volume of mortgages will reach 40 to 50 billion Euros in 4 to 5 years.808 issued totaling € 3 billion.441 issued mortgages adding up to an estimated € 790 million.2%. the total mortgage stock rate has reached a total of € 22.516 108.088 109. taken that June 2007=100.913 116. In the second quarter the buying tendency gained momentum with government incentives.com ERA Europe © • www. Mortgage According to research conducted by The Association of Real Estate Investment Companies (GYODER). Bursa +0.896 25.333 92.5 billion in the first quarter of 2010.645 55.360 21.68% compared to December 2009 and 6.44% compared to January 2010. 3. The weakest interval with the effect of the global crisis for mortgages was recorded to be the last quarter of 2008 with a total of 27. Turkey Tel: +90 232 445 14 28 Fax: +90 232 445 14 28 info@eraturkey.449 60.4% of collective bank credits. Izmir and Kocaeli price increases recorded are respectively.European Residential Real Estate Market Trends 2010 Transaction Summary 2008-2009 Interval 2008 Q1 2008 Q2 2008 Q3 2008 Q4 2009 Q1 2009 Q2 2009 Q3 2009 Q4 Total Turkey 112. Izmir on the other hand experienced a price decrease of -0.559 44.464 55.774 47. In 2003 the total number of issued mortgages was 14.783 59. Turkish composite residential real estate sales prices have increased at a rate of 0. This trend can be noticed throughout the last quarter of 2009 and first quarter of 2010. Ankara +0.861 194. there were 280.2%.743 111.411 28. A gradual increase in mortgages has been recorded in the past eight quarters.1%. Between 2004 and 2009 the mortgage volume was multiplied by 13 reaching € 18. *TUIK (Turkish Statistics Institute) Compared to residential markets.755 59.eraeurope.230 52. The drop in sales and rental prices did impede and transitioned into a process of a conservative rise.3% in prices has been recorded in the 2010 Turkish real estate market.000 issued mortgages. Prices According to the Reidin Real estate Index some prominent features of 2010 are as follows: In February 2010.858 56. ERA TURKEY Izmir. however.871 53. The mortgage system has had a slow but steady rise in Turkey. In the last quarter of 2009.687 Other Cities 51. Given that the growth rate and stability of the economy are sustained.90%.41%.73%.com • All Rights Reserved • June 2010 • Page 46 of 51 . The decreasing trend of mortgage interest rates seen in the previous four quarters was sustained in the last quarter of 2009 and through the first quarter of 2010.2 billion. When compared to 2007. In the subsequent quarters mortgages increased in numbers issued and volume and displayed a strong position in the third quarter of 2009 with a total of 96.386 26.26%.4% and 5.091 56. Despite a small increase rate in the second and third quarters of 2009.168 113. with an increased stock rate of € 1. Antalya +0.eraturkey. Though even at this rate the ratio of mortgage to GNP will still remain at a very low of 4%.988 52.5%. Some price increase values of major cities are: Kocaeli +0.793 91.55%. According to the same research the number of issued mortgages increased rapidly in the third quarter of 2009. Buying Tendency According to a report published by the Turkish Republic Central Bank.5 billion. a further decrease is not likely at this point. The average monthly interest rate in 2010 was 0. In Adana.6% and Bursa -9. Antalya -14. investments in commercial real estate were rather limited in the last quarter of 2009.

00% Unchanged Total N° of Broker Offices -3.95% Decrease Total N° of Broker Offices 0.31% Increase Mortgage Rates -1.23% Increase Mortgage Rates 2.75% Decrease Avg. Home Price/ Nationally -0.27% Decrease Number of Brokers -5.40% Increase N° of BULGARIA Residential Transactions 2009 vs 2008 Trend 2010 -29.10% Increase Number of Brokers N/A N/A Total N° of Broker Offices N/A Unchanged Buyer or Seller Market Buyer Buyer Average Days on Market 100.84% Increase N° of FRANCE Residential Transactions 2009 vs 2008 Trend 2010 -9.95% Increase Avg.57% Decrease Buyer or Seller Market Buyer Buyer Average Days on Market 19. Home Price/ Capital City -1.eraeurope.46% Decrease Avg.00% Unchanged CZECH REPUBLIC 2009 vs 2008 Trend 2010 N° of Residential Transactions -21.68% Decrease Buyer or Seller Market Buyer Buyer Average Days on Market 5.69% Decrease Avg.59% Decrease Mortgage Rates 0.85% Decrease Avg.26% Decrease Total N° of Broker Offices -2. Home Price/ Nationally -20. Home Price/ Capital City -1. Home Price/ Capital City -7.03% Decrease Number of Brokers -4.11% Decrease N° of GREECE Residential Transactions 2009 vs 2008 Trend 2010 -27.61% Decrease Avg.00% Unchanged Buyer or Seller Market Buyer Buyer Average Days on Market -5.00% Increase Avg.22% Increase ERA Europe © • www.54% Unchanged N° of GERMANY Residential Transactions 2009 vs 2008 Trend 2010 1.56% Decrease Avg.17% Increase Mortgage Rates -0.22% Decrease Avg.05% Increase Number of Brokers N/A Decrease Total N° of Broker Offices N/A Decrease Buyer or Seller Market Buyer Buyer Average Days on Market 24.95% Decrease Mortgage Rates 1.00% Unchanged Number of Brokers -3.08% Decrease Avg.00% Unchanged Buyer or Seller Market Buyer Buyer Average Days on Market 13.00% Unchanged Total N° of Broker Offices 0.57% Decrease Avg. Home Price/ Nationally -7. Home Price/ Nationally N/A Decrease Mortgage Rates N/A Increase Number of Brokers N/A Decrease Total N° of Broker Offices N/A Decrease Buyer or Seller Market Buyer Buyer Average Days on Market N/A Increase N° of IRELAND Residential Transactions 2009 vs 2008 Trend 2010 -42.80% Unchanged Number of Brokers 0. Home Price/ Capital City -5. Home Price/ Nationally -0.European Residential Real Estate Market Trends 2010 Summary of Tables & Charts N° of AUSTRIA Residential Transactions 2009 vs 2008 Trend 2010 -2.00% Decrease Avg. Home Price/ Nationally -3.38% Decrease Mortgage Rates -0.00% Increase Avg.08% Increase Avg. Home Price/ Capital City -5.88% Decrease Avg.00% Decrease Avg.13% Decrease Buyer or Seller Market Buyer Buyer Average Days on Market 36. Home Price/ Capital City -22.12% Decrease Total N° of Broker Offices -5.07% Decrease Number of Brokers 0. Home Price/ Capital City -1. Home Price/ Nationally -18. Home Price/ Capital City -25.com • All Rights Reserved • June 2010 • Page 47 of 51 .00% Decrease N° of BELGIUM Residential Transactions 2009 vs 2008 Trend 2010 -6.15% Decrease Mortgage Rates -0. Home Price/ Nationally -8.

Home Price/ Nationally N/A N/A Mortgage Rates -1.00% Decrease Number of Brokers -1.59% Decrease Avg.44% Decrease Total N° of Broker Offices -33.69% Decrease Avg. Home Price/ Nationally -4. Home Price/ Nationally -7. Home Price/ Capital City N/A Decrease Avg.35% Unchanged Mortgage Rates -2. Home Price/ Capital City -10.00% Decrease Avg.06% Increase Total N° of Broker Offices 4.66% Unchanged Mortgage Rates 0.11% Decrease N° of ROMANIA Residential Transactions 2009 vs 2008 Trend 2010 -27.80% Decrease Avg.60% Increase Number of Brokers N/A N/A Total N° of Broker Offices N/A N/A Buyer or Seller Market Buyer Buyer Average Days on Market 0.03% Increase Avg. Home Price/ Capital City -6.26% Decrease Total N° of Broker Offices -1.41% Decrease Total N° of Broker Offices -9.67% Increased NETHERLANDS 2009 vs 2008 Trend 2010 N° of Residential Transactions -30. Home Price/ Capital City -24.08% Decrease Avg.69% Decreased Total N° of Broker Offices -12.18% Decrease Avg. Home Price/ Nationally N/A Decrease Mortgage Rates 0.29% Unchanged Avg.33% Decrease Buyer or Seller Market Buyer Buyer Average Days on Market 37.38% Increase Avg.European Residential Real Estate Market Trends 2010 N° of ITALY Residential Transactions 2009 vs 2008 Trend 2010 -11. Home Price/ Nationally 3.5% Increase LUXEMBOURG 2009 vs 2008 Trend 2010 N° of Residential Transactions -17.52% Decrease Buyer or Seller Market Buyer Buyer Average Days on Market 72.eraeurope.50% Unchanged Avg.09% Decrease Avg.00% Decrease N° of TURKEY Residential Transactions 2009 vs 2008 Trend 2010 24.50% Decreased Buyer or Seller Market Buyer Buyer Average Days on Market 16.00% Increase Mortgage Rates -3.90% Decrease Number of Brokers 20. Home Price/ Nationally 0.26% Decrease Buyer or Seller Market Buyer Buyer Average Days on Market -11.20% Decrease Number of Brokers -7. Home Price/ Capital City -4. Home Price/ Capital City N/A 0 Avg.41% Decrease Mortgage Rates -0.65% Increase Number of Brokers 2.76% Unchanged SWITZERLAND 2009 vs 2008 Trend 2010 N° of Residential Transactions -9.00% Increase Buyer or Seller Market Buyer Buyer Average Days on Market -15. Home Price/ Nationally N/A Decrease Mortgage Rates 11.60% Decrease Number of Brokers -44. Home Price/ Capital City -16.88% Decrease Number of Brokers N/A Unchanged Total N° of Broker Offices N/A Unchanged Buyer or Seller Market Buyer Unchanged Average Days on Market Unchanged Increase ERA Europe © • www.00% Increase Total N° of Broker Offices 40.18% Increase Mortgage Rates -0.70% Unchang ed Number of Brokers -7.67% Decrease Avg.18% Increase N° of PORTUGAL Residential Transactions 2009 vs 2008 Trend 2010 -13.00% Unchanged N° of SWEDEN Residential Transactions 2009 vs 2008 Trend 2010 6.10% Decrease Avg. Home Price/ Capital City 0.28% Decrease Avg.08% Unchanged Buyer or Seller Market Seller/Buyer Seller/Buyer Average Days on Market -4.com • All Rights Reserved • June 2010 • Page 48 of 51 . Home Price/ Nationally -10.

Home Price/Nationally 2009 ! 450.000 500.European Residential Real Estate Market Trends 2010 Chart 8 Total number of residential transactions (including new and resale properties) as reported for 2009: ERA Europe Market Trends Survey Residential Transactions 2009 800.000 200.000 100.000 ! 300.000 600.000 0 EP IT AL Y EN M D AL IA IA IA D S E E Y S U C C AN D AN N AR EE AN AN ED R N ST LG RT U LA YP M EL LA H LG M R SW FR R AU BE ER IR ER BU ZE PO G R C ET Chart 9 The average price of a residence sold nationally in 2009: ERA Europe Market Trends Survey Avg.000 ! 350.000 ! 100.000 ! 200.000 !0 N !"#$%#&' R EP S E E M D AR IA IA Y EE C U C AN EL AN LG IU '''()*' S IT AL Y AL D '''()*' ED EN IT ZE R LA N D IA KE Y TU R AU ST R C YP R ZE C H RT U G AN LA N M LG G R M AN BE ET H ER BU C PO G R O SW FR ER IR ERA Europe © • www.000 ! 250.eraeurope.000 ! 400.000 400.000 ! 50.000 700.com • All Rights Reserved • June 2010 • Page 49 of 51 N SW SW IT H ZE G C TU C O R KE IU R R G Y .000 ! 150.000 300.

00% 6.000 !0 !"#$%#&' EP IT AL Y EN M D AL IA IA IA D S E E Y S U C C AN D AN N AR AN KE TU TU R KE Y R IU R Y R EE G AN ED R N ST LG RT U YP M EL LA H LG M R AU BE ER SW FR ER C IR O BU ZE PO G R C ET Chart 12 The average mortgage rates for 2009.00% 4.00% 8.00% R EP N ET H ER C ERA Europe © • www.000 ! 200. Home Price/Capital City 2009 ! 600. There are variations in average length of mortgages and in variable and fixed rate loans offered: ERA Europe Market Trends Survey Mortgage Rates 2009 14.00% 0.European Residential Real Estate Market Trends 2010 Chart 10 The average price of a residence sold in the capital city in 2009: ERA Europe Market Trends Survey Avg.00% 2.00% 10.eraeurope.000 ! 400.00% 12.000 ! 500. for more details on the terms and conditions please refer to the country reports.000 ! 300.000 ! 100.com • All Rights Reserved • June 2010 • Page 50 of 51 N SW EN IT ZE R LA N D S E E M D S AR IA IT AL Y EE C U C AN EL AN LG IU D AL IA AU ST R RT U G AN IA Y C YP R AN ZE C H LA N M LG G R M BE BU PO G R O SW FR ER IR ED SW IT H ZE G C R LA .

com In Europe: Kathy Auclair +33 6 61 60 06 29 ERA Europe © • www.00% !"#$%#&' AUSTRIA CYPRUS BELGIUM BULGARIA CZECH REP FRANCE GERMANY GREECE ()*' IRELAND ITALY NETHERLANDS PORTUGAL LUXEMBOURG ()*' ROMANIA SWEDEN SWITZERLAND !"#$%#&' TURKEY -15.eraeurope.European Residential Real Estate Market Trends 2010 Chart 13 Average time a property listing remains on the market before being sold.00% 85.00% 5.00% 25.eraeurope.com • All Rights Reserved • June 2010 • Page 51 of 51 .00% 65.00% ERA EUROPE Winter Park. FL 32792 USA Tel: +1 407 657-7992 Fax: +1 407 551-2031 info@eraeurope.com www.00% -35. Days on Market: ERA Europe Market Trends Survey Trend in Days on Market 2009 vs 2008 105.00% 45.

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