Investor concerns over the sovereign debt in some eurozone nations is weighing on real estate markets across the continent, Knight Frank has asserted. The firm noted that there is a "continuing polarisation in performance" between core locations in Western Europe and those classed as peripheral markets.
The company cited Germany and the Nordic countries as being of particular interest to property investors at present due to the "sound underlying economic fundamentals" offered in the nations. It added that there is also renewed interest in certain Central European markets as investors search for higher yields following compression in core destinations.
Meanwhile, Knight Frank also pointed out that the lack of finance for investments in assets outside the prime sector is likely to affect real estate transactions for the foreseeable future. Earlier this week, the current and incoming head of the European Central Bank Jean-Claude Trichet and Mario Draghi called on governments to implement fiscal reforms without delay or be prepared to face a deepening of the eurozone's debt problems.
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