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8 European cities ripe for investment in the 2020s, from a property manager who built a $1 billion portfolio

  • Europe still faces a volatile real estate market and the expected decrease in home prices over the next year could mean it is the right time for savvy real estate investors to buy.
  • Stephane De Baets, founder and president of Elevated Returns and a longtime real estate investor, gave us his picks.
  • Zug and Ibiza are two of the eight cities that make the cut.
  • Visit Business Insider's homepage for more stories.

The real estate market in some parts of Europe is getting hammered by the COVID-19 pandemic.

According to Deloitte's 2020 property index, the residential real estate market is forecast to stagnate in terms of prices and see a decline in transaction activities. All are indicators that a savvy investor could swoop in.

"When you feel that this is the end of the world and everything will go down to zero, when you have that feeling in your stomach, that probably tells you that it's the right time to buy," said longtime real estate manager Stephane De Baets,  founder and president of international asset management firm Elevated Returns.

Elevated Returns says the value of its property value is more than $1 billion, and the firm controls the St. Regis Aspen Resort in Aspen, Colorado, and the Thailand T77 office buildings of Sansiri's headquarters, as well as other properties in the United States, Europe, and Southeast Asia.

De Baets told Business Insider that while real estate investments are great opportunities to earn extra money, investors should think about long-term results, and think carefully about the locations — some cities will be more profitable than others in the long run. 

Resort destinations due to staycations and leisure cities will do really well as people prioritize wellbeing over money, he said: "It's important to try and understand what changes are temporary and which ones might last a long time."

These are the cities that De Beats said investors should pay close attention to amplify returns.

Florence, Italy

Florence is the eighth-biggest city in Italy and located in the center of the country. It's a famous tourist destination thanks to the Renaissance art masterpieces and architecture. According to De Beats, it's also gentrified — he points to the presence of high-end brands in the city as evidence.

"The right brands are moving into Florence. We always try to see those early indicators into a town, because we know that these people are tastemakers," he said. 

Home prices average around $5,454 per square meter, with the median rent at $1,036.

Madrid, Spain

Madrid is the biggest city in Spain and located in the center of the country. It's well-known for its boulevards, parks like Buen Retiro, and for institutions like the Prado Museum.

According to De Baets, people will migrate to places with good quality of life — and Spain is one.

He says Spain's economic crisis prior to the pandemic has led to cheaper property that he believes will lift in value. "Property developers will need to offload their inventories and the property is going to be worth a lot more three years from now," he told Business Insider.

"The key is to have a good opportunity [in terms of costs] and have the quality of life," he said.

Home prices average around $3,900 per square meter, with the median monthly rent at $16 per square meter.

Barcelona, Spain

Barcelona is the second biggest city in Spain and located on the east coast of the country. Tourist hotspots include the Sagrada Família church and artworks dotted around the city by the city's most famous son, Antoni Gaudí. Famed art museums include the Museu Picasso and Fundació Joan Miró.

Home prices average around $3,900 per square meter, with the median monthly rent at $1,258.

Ibiza, Spain

Ibiza is one of the Balearic Islands, the archipelago of Spain in the Mediterranean Sea. It's famous for the nightlife in Ibiza Town and Sant Antoni. But it's also home to quiet towns such as Playa D'En Bossa.

According to De Baets, Ibiza is a great place for remote working. For the price of a two-bedroom apartment in New York, you can have a seven-bedroom mansion in Ibiza, a nice workplace, and a good internet connection, he said.

Home prices average around $8,058 per square meter, with the median monthly rent at $1,333.

London, United Kingdom

London is the biggest city in the United Kingdom and located in the south-east of England. It's known for its diverse food and cultural scene and iconic sights such as the Big Ben and Westminster Abbey.

According to De Baets, people will always come back to London because of its multicultural vibe, and due to young professionals moving there for jobs.

Home prices average around $871,599 with the median monthly rent at $2,151.

Lisbon, Portugal

Lisbon is the biggest city in Portugal and located on the south-west coast. It features historic attractions and UNESCO heritages such as the Mosteiro dos Jerónimos.

According to De Baets, Portugal sits alongside Italy, Spain, and Switzerland as a location where people are set to travel the most in the near future, making them good investments. 

Home prices average around $701,430 with the median rent at $1,726.

Montreux, Switzerland

Montreux is a resort town on Lake Geneva. The Montreux Riviera is known for its micro climate and the July Montreux Jazz Festival.

According to De Baets, it's "a synonym for wellness." As people focus more on taking care of themselves, wellness destinations will become more popular, especially post COVID.

Home prices average around $1,466,454 with the median rent at $1,984.

Zug, Switzerland

Zug is the largest town and capital of the Swiss canton Zug.

The area is the cryptocurrency capital of Switzerland. According to De Baets, it is going to be the "Silicon Valley crypto [capital] of Europe" in the next five years, since it has special tax and licensing allowances for anyone involved in the digital asset and crypto business.

De Baets predicts a rise in conferences and a relocation of businesses to Zug, making it a "smart choice" for commercial or residential investment.

Home prices average around $3,087,271. with the median rent at $2,717.

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