London has passed Paris to reclaim the number one spot as the most attractive European city for residential investors, according to Patrizia’s European Living Cities Index 2024.
Zurich claimed third place, up from fourth in 2022, with Stockholm also performing strongly and rising to seventh from ninth place in the rankings.
The biennial index analyses 142 capitals and larger cities throughout Europe to determine which are the most attractive and liquid, helping institutional investors develop a diversified European living portfolio.
As well as producing an overall ranking for investment attractiveness, it also analyses cities within a set of key sub-categories.
In terms of location quality, it measures a broad range of factors including unemployment rate, average household income and green space in a city. Within this sub-category, Zurich ranked the highest, ahead of Basel and Luxembourg.
Under connectivity, which covers a city’s transportation amenities such, average travel time to work and car-to-work ratio, Vienna rated highest, ahead of Bratislava and Helsinki.
For market fundamentals, measuring a city’s core demographic data such as population, working population ratio and number of households, London claimed top spot, followed by Paris and Berlin.
In the innovation sub-category, which analyses key factors driving creativity in a city, such as student population, patent applications and youth ratio, Paris took top spot, ahead of London and Munich.
Marcus Cieleback, chief urban economist at Patrizia, said: “We live in a world in transition where rapid urbanisation will arguably be the defining force that shapes the future of our cities. As long-term investors, we are deeply passionate about understanding the drivers of what makes a city attractive to invest in, both now and in the future, and providing this intelligence to our investors as part of our broad mix of investment solutions.
“Now in its eighth year, our European Living Cities Index augments a city’s attractiveness rating with key liquidity indicators and the fundamental characteristics of a smart city, creating a comprehensive ranking that informs our convictions for living sector investments across the risk spectrum.”
Mahdi Mokrane, Patrizia head of investment strategy and research, co-head fund management and head of fund management real estate, added: “The living sector across the risk spectrum is one of the key growth areas central to Patrizia’s new mid-term strategy to grow to a €100bn (£82bn) AUM real assets investment manager by 2030.
“The research insights provided by the European Living Cities Index broadens our local knowledge to identify the key drivers of performance and how they may change over time. It helps us better understand ‘what makes a city tick’.”
Image from Merlin Entertainments
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