Living investment growing across regions

Despite challenging geopolitical and economic conditions, the long term structural positive fundamentals for living assets continue to drive growth in investment. First-quarter activity was robust across the U.S., EMEA and Asia Pacific, pushing each region to higher volumes versus the previous year.

U.S. living investment volumes surpassed US$22 billion during the quarter, ahead of the US$20 billion total in Q1 2024. Institutional investors continue to be active, with bidding activity finishing Q1 46% above the first quarter of last year. The living sector maintained its position as the largest in Europe for transactional volumes at the start of 2025, with the Q1 total of US$19.2 billion reflecting both an uplift on Q4 and more than double the level in the same period last year. In Asia Pacific, the positive trends recorded at the end of 2024 were maintained as regional Q1 transaction volumes rose to US$4.2 billion, building on the previous quarter and 175% above Q1 2024.

Future trends: Investor conviction supporting larger deals and increasing institutionalization

Short-term: Undersupply continues to be a pressing concern for housing markets around the world, with urbanization, international mobility and shrinking households contributing to growing rental demand. In spite of the influx of new deliveries in the U.S. over the last 24 months, multifamily construction starts have declined by 77% from recent peak levels as of Q1. Meanwhile in Europe, higher construction costs and the effects of a slowdown in forward funding over 2022-2023 will continue to stifle deliveries this year. Despite the volatile outlook, investor conviction in the sector will support the growth of larger platform, portfolio and entity-level deals in 2025.

Long-term: Growing institutionalization of housing markets as investors allocate more capital to living sectors and diversify into new markets is expected to lead to the number of countries achieving average annual investment of over US$500 million expanding to over 20 by 2030. Living is forecast to maintain its position as the largest sector for investment volumes with a further US$1.4 trillion in transactions over the next five years.