House prices up by 5.4% in the euro area, 2.4% in Cyprus in Q4 2020

In the fourth quarter of 2020, house prices, as measured by the House Price Index, rose by 5.4% in the eurozone, by 5.7% in the EU and by 2.4 in Cyprus, compared with the same quarter of the previous year, according to figures released today by Eurostat, the statistical office of the European Union.

For the euro area, this is the highest annual increase since the fourth quarter of 2006. In the third quarter of 2020 house prices rose by 4.9% and 5.3% respectively.

Compared with the third quarter of 2020, house prices rose by 1.4% in the euro area,1.3% in the EU and 4.7% in Cyprus in th fourth quarter of 2020.

Among the Member States for which data are available, the highest annual increases in house prices in the fourth quarter of 2020 were recorded in Luxembourg (+16.7%), Denmark (+9.8%) and Lithuania (+9.4%).

Compared with the previous quarter, the highest increases were recorded in Cyprus and Luxembourg (+4.7% each), Lithuania (+3.9%) and Estonia (+3.8%), while decreases were observed only in Spain (-0.8%) and Hungary (-0.7%).

Meanwhile, between 2010 and the second quarter of 2011, house prices and rents in the EU followed similar paths. Since the second quarter of 2011, they have followed very different paths: while rents increased steadily throughout the period up to the fourth quarter of 2020, house prices have fluctuated significantly.

After a sharp decline between the second quarter of 2011 and the first quarter of 2013, house prices remained more or less stable between 2013 and 2014. Then, there was a rapid rise in early 2015. From then onwards, house prices have increased at a much faster pace than rents.

Over the period 2010 until the fourth quarter of 2020, rents increased by 14.9% and house prices by 28.6%.

When comparing the fourth quarter of 2020 with 2010, house prices increased more than rents in 18 EU Member States. House prices increased in 23 Member States and decreased in four, with the highest rises in Estonia (+112.8%), Luxembourg (+99.8%), Hungary (+90.6%), Latvia (+85.6%) and Austria (+81.4%). Decreases were observed in Greece (-28.1%), Italy (-15.2%), Spain (-5.2%) and Cyprus (-3.4%).

For rents, the pattern was different. When comparing the fourth quarter of 2020 with 2010, prices increased in 25 EU Member States and decreased in two, with the highest rises in Estonia (+143.5%), Lithuania (+109.2%) and Ireland (+61.8%). Decreases were recorded in Greece (-25.2%) and Cyprus (-4.1%).