House prices across the European Union rose 4.7% in the second quarter of 2026 compared with a year earlier, down from 5.1% in the first quarter. The slower annual increase leaves buyers facing higher purchase prices, with wide differences between national markets.
Eurostat’s October 1 release put annual growth in the euro area, the countries using the euro, at 4.0%, compared with 4.6% in the previous quarter.
Prices also increased between the first and second quarters: by 1.2% across the EU and 1.1% in the euro area. Annual growth therefore eased while prices continued to climb over the latest three-month period.
National markets are moving at different speeds
Portugal recorded the largest annual increase, at 16.5%, followed by Bulgaria at 15.5% and Lithuania at 14.3%. Prices fell in Finland by 2.7%, Luxembourg by 2.2% and France by 0.8%.
For a buyer, lender or developer, the EU average provides a broad comparison rather than a description of the market in a particular town. National figures can themselves conceal differences between cities, regions and types of property.
The release does not establish why each market moved. An increase in transaction prices cannot, on its own, show how much came from stronger demand, limited supply, financing conditions or changes in the properties sold.
What does the House Price Index measure?
The House Price Index tracks changes in residential property prices paid by households. It covers new and existing homes, including apartments, detached houses and townhouses.
These are nominal price changes, measured without deducting inflation. They should not be read as changes in the purchasing power of a property investment. The index also measures purchase prices rather than rent or a household’s complete monthly housing bill.
The European figures combine national indices with economic weights. They are not a simple average of every home sold, nor a single quoted price for a typical European property. The quarterly figures are not seasonally adjusted, so recurring patterns in the timing of sales can affect comparisons.
Affordability also depends on income and credit
A home becomes easier to finance when a buyer’s income grows relative to the required mortgage payment. Purchase prices are part of that calculation, alongside the interest rate, the amount borrowed and the repayment period.
The European Central Bank illustrated these relationships in a July 2025 analysis of housing affordability. Its model compared average household income with payments on a mortgage covering 80% of a home’s value over 25 years.
In that analysis, higher mortgage rates had outweighed income growth during the deterioration in affordability in 2022 and 2023. Subsequent improvement through early 2025 reflected lower rates and rising incomes, while increasing house prices worked in the opposite direction. Those findings concern that earlier period, rather than measuring affordability in the latest quarter.
A household must also assemble the money it does not borrow. A manageable monthly payment does not remove the need for a down payment, transaction costs or a lender’s approval.
Housing access matters to employers, too
We examined the local consequences in our earlier coverage of Europe’s housing affordability and labor mobility. That reporting focused on the difficulty of entering local housing markets, including for people considering a move for work.
Employers recruiting from outside their area have reason to look beyond national price trends. A worker needs an available home within reach of the job and within their budget. A slower annual increase in property prices supplies neither of those answers.
For businesses selling homes, arranging mortgages or supplying household goods, the latest release establishes a direction in purchase prices. Assessing demand also requires evidence on completed sales, borrowing and household finances.
The figures cover April through June, rather than conditions at the beginning of October. Eurostat has scheduled its third-quarter release for January 11, 2027.
