Higher building costs and mortgage rates, limited supply and the rise in house purchases as an investment created eye-watering price levels in certain countries across the EU.
Hungary saw the biggest jump in prices, with dwellings costing three times as much as they did in 2015. Nowadays, an apartment in the country's capital, Budapest, is priced in the range, on average, from €250,000 to €1.5 million.
Hungary is followed by Iceland, where prices are approximately 2.5 times what they were in 2015. In the capital region, in Reykjavík and six municipalities around it, dwellings are the most costly, with average purchase prices of around €558,000.
According to the Bank of Iceland, as supply has grown and demand is softening, house prices are increasing at a slower pace, yet the year-on-year house price inflation was still 8% in March.
Elsewhere in Europe, there was also a considerable rise in house prices over the last 9 years. Lithuania, Portugal, the Czech Republic, Bulgaria, Estonia and Poland all witnessed prices more than double.
Meanwhile, at the bottom of the list, there is Finland, where property prices are not substantially higher than what they were almost ten years ago. However, there are big differences between the cost of dwellings in the rural areas and in Helsinki, for instance.
According to Global Property Guide’s recent report, the downturn in the Finnish property market, which started in 2021 and saw prices collapse by 14% annually, has likely bottomed out.
They expect the ongoing economic recovery to support a gradual increase in house prices, mainly newly built ones, as the second-hand dwellings’ price is expected to increase only marginally by 1-3% this year. Second-hand flats have an average price of €4,612 per square metre, driving the cost of a 75 sqm one to €345,900, but in Helsinki, this could be more like €4-500,000.
Eurostat has no data for Greek house prices, but according to the Bank of Greece's Residential Property Index, prices are just above their 2008 level in urban areas.
Outside of the EU, in Turkey, prices are 17 times what they were in 2015. In Istanbul, a two–bedroom apartment tends to cost around €120,000 nowadays. (It may seem like a good deal compared to Western European prices, but consumer prices are almost up 38% year-on-year and average gross salaries are slightly above €600 per month.)
How much more affordable is renting a house?
Renting a house or apartment also became a lot more expensive across Europe, even though they increased at a slower pace than prices.
According to Eurostat’s latest available data, rents increased by 26.7% in the EU, between 2010 and Q4 2024.