Year-to-date, total investment volumes have reached €113.3 bn, a 5% rise over the previous year.

While this figure remains below the five-year average, several regions are demonstrating more robust recovery, Savills said.

Southern Europe and Central and Eastern Europe (CEE) have shown particular resilience, with expected year-over-year increases of 11% and 16%, respectively. Among the core markets of the UK, Germany, and France, the UK is experiencing a strong rebound with a 26% year-on-year growth in investment volumes.

James Burke, director of global cross-border investment at Savills, said: ‘The European real estate market is showing signs of increasing activity, particularly since the return from the summer break. A key boost came on 12 September, when the European Central Bank decided to cut interest rates for a second time, which positively impacted market sentiment across the Eurozone. Since then, investor interest has been growing, supported by improving pricing conditions and an increasing number of assets coming to market.’

Savills has forecast that European real estate investment volumes will reach approximately €170 bn by the end of the year, marking a 15% increase compared to the previous year. This positive momentum is anticipated to persist into 2025, with full-year figures potentially reaching €219 bn, representing a significant 29% year-over-year growth.

Lydia Brissy, director of European research at Savills, commented: ‘Across Europe, yields are expected to remain stable over the next six months, with compression likely for logistics assets and, to a lesser extent, retail parks. Shopping centre yields may continue to increase slightly. From March next year, the hardening of prime yields should begin to spread across asset classes throughout Europe.’