These are the best real estate investment destinations in Europe for 2025

A new study revealed that European countries with high rental returns and low real estate taxes provide the best real estate investment opportunities in 2025, with Central and Eastern European countries topped the scene, led by Moldova, according to a report published by the “Euronews” network, quoting the British Insurance Company “William Russell”.

Moldova in the lead … an emerging market with rewarding returns

Moldova, the country located in the Balkan region, ranked first in the classification of European countries most attractive to real estate investment. The report described the real estate market in Moldova as “emerging and highly returning”, especially for early investors who are able to tolerate risk.
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The cost of purchasing real estate in the country is about 2.80% as a maximum of the value of the property, with an income tax on rent not exceeding 12%, which gives it a high classification in terms of rental return. The capital Kishinao is witnessing remarkable growth in the infrastructure, hospitality and business sectors, in addition to a noticeable increase in tourism activity, which supports the short -term rental market.

Although Moldova is not part of the European Union, it is currently considered a candidate to join, which may enhance its attractiveness in the future.

Lithuania second .. a stable European market attracts investors

Lithuania came second in the list of the best countries for real estate investment in Europe for the year 2025, despite the increase in real estate prices by 10% on an annual basis during the last quarter of 2024, according to the “Eurostat” data.

Lithuania does not impose any restrictions on foreigners’ possession of real estate, which increases their attractiveness. According to the report, the annual rental return reached about 6.39%, while the purchase costs did not exceed 4.10% of the value of the property, which provides the opportunity for steady growth and rewarding returns in the long term.
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Northern Macedonia is the third best investment option

Northern Macedonia ranked third, a nominated country to join the European Union as well. Its capital, Scoeppe, is witnessing urban development and growth in demand for residential and commercial real estate, amid tax facilities and government incentives for attracting foreign investments.

The report data indicates that the annual rental return in the country reaches 6.47%, making it a strong competitive option in the European market.

Other countries offer promising returns

In addition to the three adults, Serbia, Ireland and Latvia show annual rental returns exceeding 7%, according to the “very good return” classification.

In Ireland, rental returns are from the top in Europe, but the high real estate taxes may reduce the annual net return. As for Bulgaria, Andorra and Montenegro, it combines high returns on rents and relatively low income taxes, which increases their attractiveness.

Italy: a high tax, but it does not abolish the feasibility

Although the rental tax rate in Italy is 21%, it came within the countries that achieve the third of the highest European rental return by a rate 7.56%. This makes it suitable for some long -term investment strategies, despite tax costs.