Savills published its European investment forecast on 1 October 2026, and it points to a steady autumn rather than a spectacular one. Savills expects 156 billion euro of investment volume in the first three quarters of 2026, 4 per cent more than the same period last year. Its commercial real estate teams read the number as a market finding its feet again after two quiet years, though the recovery is far from uniform.
What matters most sits under the average. Central and Eastern Europe is running 34 per cent above last year, the Nordics 25 per cent and Southern Europe 20 per cent, while Western Europe is 5 per cent down. There is no broad yield compression this time to lift every market at once, and that single change reshapes the conversation an agent has with a client who is deciding where to put money.
Savills Forecasts 156 Billion Euro Of Volumes
It comes from Savills, the international adviser that tracks cross-border and domestic deals across the continent. Its release covers the first three quarters of 2026 and puts European real estate activity at 156 billion euro, up 4 per cent year on year. It is a forecast for the year to date rather than a final tally, so the figure will move as the last deals of the third quarter are counted.
It’s a direction of travel rather than a level. A 4 per cent rise is close to flat in a market still working through the repricing of the past two years, and the detail that follows is where the useful information lives. Savills is explicit that the recovery is uneven, and the regional numbers make that plain.
The Regional Split Behind The Headline Number
That split is stark. Central and Eastern Europe is expected to finish the first three quarters 34 per cent higher than last year, the Nordics 25 per cent higher and Southern Europe 20 per cent higher. Western Europe, the largest and most mature block, is 5 per cent lower. Total real estate investment is growing only because the smaller, faster regions are pulling ahead of the core.
Spain is the clearest example of why. It keeps attracting significant capital, helped by an economy that has held up better than most and by an attractive relative sovereign risk premium that makes its returns look reasonable against government debt. In Italy, large transactions are carrying activity, with out-of-town retail, hospitality and logistics drawing strong interest. Value-add capital is still the most visible buyer, but core investors are returning gradually, which is a signal worth watching.
| Region | Q1 to Q3 2026 vs 2025 | What is driving it |
|---|---|---|
| Europe (total) | +4% | Living sectors and a retail revival, led by the faster regions |
| Central and Eastern Europe | +34% | Intra-regional flows, Czech capital into Poland, defence and manufacturing demand |
| Nordics | +25% | Domestic and Norwegian buyers, large transactions, an active pipeline |
| Southern Europe | +20% | Spanish economic resilience and sovereign risk premium, Italian large deals |
| Western Europe | -5% | Slower repricing in offices and retail, buyers waiting on income certainty |
Living And Retail Lead While Offices Diverge
James Burke, Director of Global Cross Border Investment at Savills, says the living sectors now account for more than 30 per cent of European investment volumes over the first three quarters of 2026, backed by a continued revival in retail and particular interest in shopping centres. That’s a shift in what the market buys, not only in how much it spends. The office market is the other side of the story, and it is splitting rather than sinking.
Burke also points to the capital moving around the continent. Intra-European flows from UK, French, Swedish and German investors are holding up, US investors remain the largest single source of international capital into Europe, and Canadian investors are expected to become more active. In other words, the money is still there, but it is being choosier about where it lands.
- Living sectors: more than 30 per cent of volumes, spanning rented housing, student rooms and care homes
- Retail: shopping centres back in favour after several quiet years
- Logistics: still in demand, helped in Poland by defence and manufacturing activity
- Offices: the widest gap between prime and secondary stock, and the hardest sector to price
Why Pricing Now Hinges On Income Not Yields
Lydia Brissy, a director in Savills’ European commercial research team, is blunt about the old playbook. The prospect of broad-based yield compression has faded, and Savills now expects outward movements in more markets and more sectors. For any buyer whose case rested on falling yields, that case has to be rebuilt on income.
Offices and retail are likely to show the greatest divergence, because pricing is increasingly separating prime assets from secondary stock. A well-let building in a strong location and a half-empty one two streets away can now trade on very different assumptions, and the gap is widening rather than closing.
In practice, performance will depend less on market-wide yield shifts and more on three things: income growth, effective asset management, and finding assets where the price does not yet reflect the underlying potential. That is a more labour-intensive way to invest, and it rewards agents and advisers who know the local income story rather than the headline yield.
What The Split Means For Agents In Europe
For an agency, the practical message is that the map now matters as much as the market. A client asking whether this is a good moment to buy in Europe needs a regional answer, because a 4 per cent continental rise hides a 34 per cent surge in the east and a 5 per cent decline in the west.
Four moves follow from that, and they work in any of the markets covered by the Savills numbers.
- Ask where the client’s capital can actually reach, then match it to a growing region rather than to a continental average.
- Put the sector in front of the country. Living and retail are where the transactions are; offices need a prime-versus-secondary conversation before anything else.
- Set expectations on income, not yield. With no broad compression to rely on, the return case has to stand on rent and asset management.
- Watch the fourth quarter in the Nordics. Savills sees solid demand from domestic and Norwegian groups and an active pipeline, with room for improvement after a softer Swedish third quarter.
None of this is a call to chase the fastest number. It’s a reminder that in a market this uneven, a client who is shown the regional and sector split will make a better decision than one who is shown a single figure, and a well-briefed agent is the one who supplies it.
Eastern Europe Leads As Western Markets Cool
If the forecast holds, 2026 will be remembered as the year the centre of gravity moved east and north. Central and Eastern Europe and the Nordics are doing the heavy lifting, Southern Europe is close behind, and Western Europe is still adjusting. Overall the total is up 4 per cent, but almost all of the growth is coming from markets that were smaller and cheaper to enter a few years ago.
For estate agents, the sensible position is neither bullish nor defensive. The capital is there, the living and retail sectors are active, and deals are being done where income and pricing still leave room. Agents who can explain that split clearly will be the ones clients trust when the next set of numbers lands in the new year.
Questions Agents Ask About 2026 Investment
How much will European investment volumes reach in 2026?
Savills forecasts 156 billion euro for the first three quarters of 2026, 4 per cent higher than the same period in 2025. It is a forecast for the year to date, so the final figure will change slightly as the quarter closes.
Which regions are growing fastest?
Central and Eastern Europe leads at 34 per cent above last year, followed by the Nordics at 25 per cent and Southern Europe at 20 per cent. Western Europe is the exception, down 5 per cent.
Which sectors are attracting the most capital?
Living sectors account for more than 30 per cent of European volumes this year, according to Savills, with retail also recovering and shopping centres drawing particular interest. Offices remain the most divided sector, with a widening gap between prime and secondary assets.
Why has yield compression stopped?
Savills expects outward yield movements across more markets and sectors rather than the broad compression of earlier cycles. It says performance now depends on income growth, active asset management and spotting mispriced assets rather than on a rising market lifting everything.
Where is the international capital coming from?
US investors remain the largest source of international capital into Europe. Intra-European flows from UK, French, Swedish and German investors are holding up, and Savills expects Canadian investors to become more active.
