Montenegro, Serbia and North Macedonia are among the top 6 destinations for real estate investment in Europe for 2025.
Montenegro has ranked among the best real estate investment destinations in Europe for 2025, securing the sixth spot on a list published by British insurance company William Russell.
Thanks to a combination of solid rental yields, moderate purchase costs, and favorable tax treatment, Montenegro has been recognized as one of the most promising markets for investors seeking new opportunities on the European continent.
Among other countries in the region, Serbia ranked fifth, with an impressive annual gross yield of 7.04% and moderate buying and selling costs. North Macedonia secured third place in the overall ranking, further confirming the growing attractiveness of the real estate market in the Balkans.
From other regional countries, Croatia ranked 14th with moderate returns and solid investment potential, while Slovenia ranked 20th due to slightly higher costs and taxes.
Top European Countries for Real Estate Investments
At the top of the list is Moldova, which has emerged as a growing market with a high gross return of 8.38% and low property purchasing costs. The capital, Chișinău, is seeing significant growth in infrastructure, hospitality, and business sectors, further stimulating the short-term rental market.
Lithuania took second place, thanks to dynamic real estate price growth and high rental income. The country offers a 6.39% annual gross return and an open market for foreign investors, making it especially attractive.
Latvia and Ireland also provide high rental prices, offering investors strong gross returns.
Although Italy has somewhat higher taxes, its 7.56% gross return is appealing for certain investment strategies.
Countries with the Least Attractive Real Estate Investment Conditions
At the other end of the list are some of the most developed European economies, where high taxes and property purchasing costs significantly reduce the profitability of real estate investments.
Belgium ranks at the very bottom of the list, with the lowest investment score. High buying and selling costs, combined with an extremely high rental income tax of 50%, make this country the least attractive for real estate investors.
France and Luxembourg also score poorly, mainly due to high initial investment costs and tax burdens. In France, total transaction costs can exceed 14%, with significant obligations for rental income tax.
Austria, despite its stable economy, offers low gross rental yields, while high taxes further diminish investment potential.
Germany is in a similar situation, where high taxes, a overheated market, sharp price increases, and less flexibility in leasing have led to a less favorable investment environment.
Malta, Portugal, and Greece are also at the lower end of the list, partially due to a combination of high taxes and relatively modest returns.
