Home Sales Fall in Nine EU Markets

Europe’s housing market weakened at the beginning of 2026 after a broad recovery during the previous year. The number of homes sold declined in nine of the 16 EU countries that supplied quarterly data to Eurostat. Croatia, Bulgaria and Finland recorded the largest falls, while house prices continued rising across almost the entire European Union.

Croatia recorded the sharpest decline

Housing transactions fell in nine of the 16 covered EU countries during the first quarter of 2026 compared with the same period of 2025. Croatia recorded a 42.2% decline, followed by Bulgaria at 18.5% and Finland at 11.8%. Sales increased in seven countries, led by Cyprus at 13.6% and Denmark at 8.4%.

The dataset covers newly built and existing houses and apartments where the purchaser is a household. It does not represent the entire real estate investment market, corporate portfolio sales or transactions between institutional investors.

The result cannot be applied to the whole European Union without qualification. Member States provide house-sales statistics voluntarily, meaning the quarterly comparison covers only 16 of the bloc’s 27 countries. Depending on the table, between 15 and 21 EU countries and Norway supply data.

The market slowed after the 2025 recovery

Transactions increased in all 17 reporting countries during the second quarter of 2025. Croatia was the only country to record a decline in the third quarter, at 16%. In the fourth quarter, Eurostat identified falls in Luxembourg of 31.3%, Croatia of 13.7% and Portugal of 3.6%. The publication simultaneously says that four countries recorded declines but does not name the fourth, creating an internal inconsistency.

For 2025 as a whole, home sales increased in 15 of the 18 countries supplying annual figures. Slovenia led with growth of 29.9%, followed by Lithuania at 22.8% and Austria at 21.4%. Transactions declined in Croatia by 4.1%, Bulgaria by 2.5% and Poland by 1.1%.

The first quarter of 2026 therefore represents a notable loss of momentum, but one quarter is insufficient to demonstrate a prolonged EU-wide downturn. Tax changes, the end of buyer-support programmes and the timing of legal completions can affect transaction registration.

The first quarter is usually the weakest

In 14 of the 17 countries examined, the first quarter accounted for the lowest average share of annual transactions between 2015 and 2025. Slovenia, Hungary and Poland were the exceptions. Ten countries usually recorded their highest transaction volume in the final quarter.

Normal seasonality does not explain the full decline because Eurostat compares the first quarter of 2026 with the same period of 2025. Croatia is particularly notable because transactions had already declined for two consecutive quarters before the 42.2% fall recorded in early 2026.

Smaller markets can also produce volatile quarterly percentages when a limited number of major developments are completed or registrations are shifted between reporting periods.

Prices continued rising as transactions weakened

EU house prices increased by 5.1% from the first quarter of 2025 and by 1.2% from the previous quarter. Euro-area prices rose by 4.7% annually and 1% quarterly.

Among the 26 EU countries with available price data, Finland was the only one recording an annual decline, at 2%. Portugal produced the fastest increase at 17.8%, followed by Bulgaria at 14.8% and Slovakia at 14.4%.

Bulgarian transactions fell by 18.5%, while prices increased by 14.8%. Croatia combined a 42.2% decline in sales with a 14.3% rise in prices. Finland showed a more conventional correction, with transactions down by 11.8% and prices by 2%. Denmark recorded growth in both sales and prices, at 8.4% and 8.3%, while Cyprus produced increases of 13.6% and 3.4%.

The divergence does not prove one single cause. It may reflect limited supply, sellers’ resistance to lowering prices, a changing mix of completed transactions or a concentration of demand in higher-priced properties.

Fewer transactions do not guarantee cheaper homes

Owners can withdraw a property rather than accept a lower offer, while developers can delay new projects when demand weakens. Turnover then declines without producing a corresponding expansion in the number of homes available for sale.

The composition of transactions can also change. When activity falls most sharply among smaller or lower-priced properties, an index can continue rising even while fewer homes are sold.

Eurostat’s House Price Index measures changes in residential-property prices, while the house-sales statistics count registered transactions. They describe different dimensions of the market and should be analysed together.

Existing homes generate most transactions

Only 11 countries supplied a breakdown between new and existing homes for 2024 and 2025. Existing properties accounted for more transactions in every one of them, making the resale market the principal driver of total activity.

New-home transactions increased most rapidly in Luxembourg, by 36.2%, and Hungary, by 33.6%. They declined most sharply in Finland, by 22.3%, and Slovenia, by 11.6%.

Existing-home transactions rose by 34% in Slovenia and 23% in Lithuania. Declines were recorded in Croatia at 7.2%, Bulgaria at 5% and Ireland at 0.4%.

This section of the PDF contains another internal inconsistency. Eurostat states that total transactions fell in Croatia, Bulgaria and Ireland, while the annual summary and chart identify Poland as the third country recording an overall decline. The type-level data indicate that only Irish existing-home sales fell, while stronger new-home activity preserved a small total increase.

Transaction value recovered faster than prices

Eurostat separately estimates changes in the total value of homes transacted in the euro area. Transaction value declined by 17.1% in 2023, while house prices fell by only 1%. In 2024, transaction value rose by 4.2% and prices by 2.2%. In 2025, the increases reached 16.5% and 5.3% respectively.

The difference indicates that the 2025 recovery involved more market activity as well as property-price inflation.

The transaction-value measure is an estimate rather than a complete euro-area aggregate. The methodological text says it is based on 15 countries representing about 70% of euro-area economic weight in 2022, while the note below the chart refers to 17 countries and 71% of 2025 weight. The inconsistency means the figure is best used as an indicator of direction rather than a precise total for EA21.

Mortgage financing remains restrictive

The euro area’s composite cost-of-borrowing indicator for new housing loans rose to 3.48% in May 2026. The indicator combines rates on different mortgage categories using smoothed weights based on new lending volumes.

Rates varied by the initial fixation period. Floating-rate loans and those fixed for up to one year averaged 3.60%; loans fixed for between one and five years averaged 3.47%; those fixed for between five and ten years averaged 3.65%; and loans fixed for more than ten years averaged 3.32%.

Euro-area banks reported a small tightening of credit standards for housing loans during the first quarter. Mortgage demand was unchanged and weaker than banks had previously expected. Lenders anticipated a broader tightening and declining housing-loan demand during the second quarter.

Borrowing costs have fallen from earlier peaks, but households are financing homes whose prices have returned to growth. That combination can restrict transactions without producing a rapid correction in property values.

Croatia faces a sharp liquidity decline

Croatian transactions fell by 16% in the third quarter of 2025, 13.7% in the fourth and 42.2% in the first quarter of 2026. The country also recorded a 4.1% decline for 2025 as a whole.

Prices moved in the opposite direction, rising by 14.3% annually and 3.3% during the first quarter. The combination may indicate weaker liquidity, with owners maintaining high price expectations while fewer buyers complete transactions. This is an analytical inference rather than a cause established by Eurostat.

The national figures do not separate Zagreb, the Adriatic coast and inland areas, where conditions may differ substantially.

Bulgaria combines falling sales with rapid price growth

Bulgarian transactions declined by 18.5% in the first quarter after falling by 2.5% during 2025. Existing-home sales decreased by 5% last year, while new-home transactions increased.

House prices rose by 14.8% annually and 6.2% from the previous quarter, the fastest quarterly increase in the EU.

The pattern may reflect stronger demand for new and higher-priced developments, limited supply or unwillingness among existing-home sellers to reduce expectations. National data are required to establish the underlying causes.

Austria recorded a strong annual rebound

Austria was among the strongest transaction markets in 2025, with sales increasing by 21.4%. Fourth-quarter growth reached 20.2% year on year.

Austrian house prices increased more moderately, by 4.2% annually and 1.6% from the previous quarter in early 2026.

This appears more balanced than the Croatian and Bulgarian pattern, with improving liquidity accompanied by moderate price growth. Eurostat’s publication does not provide separate results for Vienna, Salzburg or other regional markets.

Buyers and investors face different risks

For purchasers, falling sales do not guarantee widespread discounts when the number of available properties remains limited.

For investors, weaker turnover means longer disposal periods and less reliable comparable prices. A recently registered transaction may not represent the price at which a similar home could be sold quickly.

Developers face a risk of accumulating unsold homes. A fall in new construction can nevertheless restrict future supply further and support prices over the medium term.

Conclusion

Eurostat recorded a significant loss of momentum after the 2025 recovery. Transactions declined in nine of the 16 countries supplying quarterly data, with Croatia, Bulgaria and Finland recording the largest falls. Cyprus and Denmark continued to expand.

The defining feature is the divergence between activity and prices. EU homes became 5.1% more expensive, while Finland was the only country recording an annual price decline. Croatia and Bulgaria combined double-digit transaction falls with double-digit price growth.

As International Investment experts report, the figures do not yet demonstrate an EU-wide housing crash. They point instead to weaker liquidity and continuing affordability pressure: mortgage financing remains relatively expensive, buyers complete fewer transactions, but limited supply, transaction composition and sellers’ expectations continue supporting prices. The next phase will depend on mortgage rates, bank lending standards, residential construction and sellers’ willingness to adjust prices.