As of July 18, 2025, the major economy with the highest yield on 10-year government bonds was Turkey, with a yield of ** percent. This is due to the risks investors take when investing in Turkey, notably due to high inflation rates potentially eradicating any profits made when using a foreign currency to investing in securities denominated in Turkish lira. Of the major developed economies, United Kingdom had one the highest yield on 10-year government bonds at this time with **** percent, while Switzerland had the lowest at **** percent. How does inflation influence the yields of government bonds? Inflation reduces purchasing power over time. Due to this, investors seek higher returns to offset the anticipated decrease in purchasing power resulting from rapid price rises. In countries with high inflation, government bond yields often incorporate investor expectations and risk premiums, resulting in comparatively higher rates offered by these bonds. Why are government bond rates significant? Government bond rates are an important indicator of financial markets, serving as a benchmark for borrowing costs, interest rates, and investor sentiment. They affect the cost of government borrowing, influence the price of various financial instruments, and serve as a reflection of expectations regarding inflation and economic growth. For instance, in financial analysis and investing, people often use the 10-year U.S. government bond rates as a proxy for the longer-term risk-free rate.

The US home loan market, a cornerstone of the American economy, is experiencing robust growth, projected to maintain a Compound Annual Growth Rate (CAGR) of 18% from 2025 to 2033. This expansion is fueled by several key drivers. Low interest rates, particularly in the early part of the forecast period, have historically stimulated borrowing, making homeownership more accessible. A growing population, coupled with increasing urbanization and a persistent demand for housing in key metropolitan areas, further fuels this market's expansion. Government initiatives aimed at supporting homeownership, such as tax incentives and affordable housing programs, also play a significant role. The market is segmented by loan type (purchase, refinance, improvement), source (banks, HFCs), interest rate (fixed, floating), and loan tenure. While refinancing activity might fluctuate based on prevailing interest rates, the underlying demand for home purchases remains strong, particularly in regions with robust job markets and population growth. Competition among lenders, including major players like Rocket Mortgage, LoanDepot, and Wells Fargo, alongside regional and smaller banks, is fierce, resulting in innovative loan products and competitive pricing. However, the market is not without its challenges. Rising inflation and potential interest rate hikes pose a significant risk, potentially dampening demand and increasing borrowing costs. Stringent lending regulations and increased scrutiny of creditworthiness could restrict access to loans for some borrowers. Furthermore, fluctuations in the housing market itself, including supply chain disruptions impacting construction and material costs, can influence the overall growth trajectory. Despite these headwinds, the long-term outlook for the US home loan market remains positive, driven by the fundamental need for housing and ongoing economic expansion in select regions. The diverse segmentation of the market allows for a nuanced understanding of the specific growth drivers and challenges within each segment. For instance, the home improvement loan segment is expected to see strong growth driven by homeowners' increasing desire to upgrade their existing properties. Recent developments include: June 2023: Bank of America Corp has been adding consumer branches in four new U.S. states, it said on Tuesday, bringing its national footprint closer to rival JPMorgan Chase & Co. Bank of America will likely open new financial centers in Nebraska, Wisconsin, Alabama, and Louisiana as part of a four-year expansion across nine markets, including Louisville, Milwaukee, and New Orleans., July 2022: Rocket Mortgage entered the Canadian Market with the acquisition. The company expanded from offering home loans in Ontario at launch to now providing mortgages in every province, primarily from its headquarters in downtown Windsor. The Edison Financial team grew along with the company, starting with just four team members in early 2020 to more than 140 at present.. Key drivers for this market are: Increase in digitization in mortgage lending market, Increase in innovations in software designs to speed up the mortgage-application process. Potential restraints include: Increase in digitization in mortgage lending market, Increase in innovations in software designs to speed up the mortgage-application process. Notable trends are: Growth in Nonbank Lenders is Expected to Drive the Market.

Since the beginning of 2022, the cost of borrowing for new loans in the European Union increased steadily, reaching a peak of 5.27 percent for businesses in October 2023 and of 4.02 percent for households in November 2023. Rising inflation for the European Central Bank (ECB) to increase its interest rate for the first time since 2016, which will lead to further increases in the cost of borrowing.

Changes in relative military power in the international system are seen as an impediment to peace. This article will focus on one particular avenue for states to increase their relative military power: sovereign borrowing. States’ ability to borrow inexpensive credit can undermine credible commitments in international relations, but only for those states that habitually use credit for military purposes. I argue that military regimes are more likely to use fiscal resources such as sovereign credit toward military spending, which leads to sudden increases in military power. As a result, adversarial states have incentives to use preventive action against military regimes before these regimes use credit for military purposes. To test this argument, I examine target behavior in militarized disputes as a function of expected borrowing costs credit and regime type. The empirical analysis demonstrates that military regimes, expected to have improved borrowing costs, are more likely to be the target of militarized disputes.

The yield on United Kingdom 10Y Bond Yield eased to 4.67% on August 18, 2025, marking a 0.03 percentage point decrease from the previous session. Over the past month, the yield has fallen by 0.01 points, though it remains 0.75 points higher than a year ago, according to over-the-counter interbank yield quotes for this government bond maturity. UK 10 Year Gilt Bond Yield - values, historical data, forecasts and news - updated on August of 2025.

Graph and download economic data for Net Percentage of Domestic Banks Increasing Spreads of Loan Rates Over Banks' Cost of Funds to Large and Middle-Market Firms (DRISCFLM) from Q2 1990 to Q3 2025 about spread, percent, domestic, Net, loans, banks, depository institutions, and USA.

Raizen SA, Brazil's largest sugar and ethanol producer, reassesses assets and pauses new projects under CEO Nelson Gomes to counter rising borrowing costs and stabilize its financial standings.

Public sector net debt amounted to 95.8 percent of gross domestic product in the United Kingdom during the 2024/25 financial year, or 90 percent when the Bank of England is excluded. UK government debt is at its highest levels since the early 1960s, due to a significant increase in borrowing during the COVID-19 pandemic. After peaking at 251.7 percent shortly after the end of the Second World War, government debt in the UK gradually fell, before a sharp increase in the late 2000s at the time of the global financial crisis. Debt not expected to start falling until 2029/30 In 2024/25, the UK's government expenditure was approximately 1.28 trillion pounds, around 44.7 percent of GDP. This spending was financed by 1.13 trillion pounds of revenue raised, and 151 billion pounds of borrowing. Although the UK government can still borrow money in the future to finance its spending, the amount spent on debt interest has increased significantly recently. Recent forecasts suggest that while the debt is eventually expected to start declining, this is based on falling government deficits in the next five years. Government facing hard choices Hitting fiscal targets, such as reducing the national debt, will require a careful balancing of the books from the current government, and the possibility for either spending cuts or tax rises. Although Labour ruled out raising the main government tax sources, Income Tax, National Insurance, and VAT, at the 2024 election, they did raise National Insurance for employers (rather than employees) and also cut Winter Fuel allowances for large numbers of pensioners. Less than a year after implementing cuts to Winter Fuel, the government performed a U-Turn on the issue, and will make it widely available by the winter of 2025.

From 2003 to 2025, the central banks of the United States, United Kingdom, and European Union exhibited remarkably similar interest rate patterns, reflecting shared global economic conditions. In the early 2000s, rates were initially low to stimulate growth, then increased as economies showed signs of overheating prior to 2008. The financial crisis that year prompted sharp rate cuts to near-zero levels, which persisted for an extended period to support economic recovery. The COVID-19 pandemic in 2020 led to further rate reductions to historic lows, aiming to mitigate economic fallout. However, surging inflation in 2022 triggered a dramatic policy shift, with the Federal Reserve, Bank of England, and European Central Bank significantly raising rates to curb price pressures. As inflation stabilized in late 2023 and early 2024, the ECB and Bank of England initiated rate cuts by mid-2024, and the Federal Reserve also implemented its first cut in three years, with forecasts suggesting a gradual decrease in all major interest rates between 2025 and 2026. Divergent approaches within the European Union While the ECB sets a benchmark rate for the Eurozone, individual EU countries have adopted diverse strategies to address their unique economic circumstances. For instance, Hungary set the highest rate in the EU at 13 percent in September 2023, gradually reducing it to 6.5 percent by October 2024. In contrast, Sweden implemented more aggressive cuts, lowering its rate to two percent by June 2025, the lowest among EU members. These variations highlight the complex economic landscape that European central banks must navigate, balancing inflation control with economic growth support. Global context and future outlook The interest rate changes in major economies have had far-reaching effects on global financial markets. Government bond yields, for example, reflect these policy shifts and investor sentiment. As of December 2024, the United States had the highest 10-year government bond yield among developed economies at 4.59 percent, while Switzerland had the lowest at 0.27 percent. These rates serve as important benchmarks for borrowing costs and economic expectations worldwide.

The global business loan market exhibits robust growth, driven by a burgeoning entrepreneurial landscape and increasing demand for capital across diverse sectors. The market's expansion is fueled by several key factors, including favorable government policies promoting small and medium-sized enterprises (SMEs), technological advancements simplifying loan application and disbursement processes, and the rising adoption of digital lending platforms. The BFSI, retail, and IT & Telecom industries are major consumers of business loans, reflecting their capital-intensive nature and ongoing expansion. While short-term loans remain prevalent, the increasing complexity of business ventures is driving demand for medium and long-term financing options to support strategic investments and expansion projects. Competition is fierce, with both established international banks like JPMorgan Chase, BNP Paribas, and Bank of China, and regional players vying for market share. The Asia-Pacific region, particularly China and India, is a significant contributor to market growth due to their large and rapidly developing economies. However, economic uncertainties, stringent regulatory frameworks in some regions, and fluctuating interest rates pose challenges to consistent market expansion. The forecast period (2025-2033) anticipates continued, albeit potentially moderated, growth, influenced by global economic conditions and evolving technological disruptions within the financial services sector. The market is expected to see increased adoption of alternative lending models and fintech solutions, presenting both opportunities and risks for traditional lenders. Despite the strong growth projections, several factors could temper expansion. Increased risk aversion by lenders in response to economic downturns or geopolitical instability could restrict loan availability. Similarly, rising inflation and interest rates can increase borrowing costs, impacting demand. Furthermore, the emergence of alternative financing options, such as crowdfunding and peer-to-peer lending, presents both competitive pressure and potential disruption to traditional lenders. Addressing these challenges requires lenders to innovate, offering tailored financial solutions and employing robust risk management strategies to maintain profitability and sustain growth in a dynamic and competitive market. The ongoing digital transformation of the financial services industry presents a significant opportunity for businesses to access capital more efficiently, but also necessitates a careful assessment of both potential benefits and risks associated with new technologies. Regional variations in regulatory environments and economic conditions further contribute to the complexity of the market landscape, requiring a nuanced approach to market analysis and strategic planning.

Turkey Domestic Borrowing Cost: Fixed Interest: Annual Compound: Year to Date data was reported at 17.349 % pa in Oct 2018. This records an increase from the previous number of 17.047 % pa for Sep 2018. Turkey Domestic Borrowing Cost: Fixed Interest: Annual Compound: Year to Date data is updated monthly, averaging 11.342 % pa from Jan 2003 (Median) to Oct 2018, with 190 observations. The data reached an all-time high of 57.436 % pa in Apr 2003 and a record low of 6.249 % pa in May 2013. Turkey Domestic Borrowing Cost: Fixed Interest: Annual Compound: Year to Date data remains active status in CEIC and is reported by Turkish Treasury. The data is categorized under Global Database’s Turkey – Table TR.M006: Domestic Borrowing Cost.

Turkey Domestic Borrowing Cost: Cash Borrowing: Annual Compound: Average data was reported at 23.796 % pa in Oct 2018. This records an increase from the previous number of 19.725 % pa for Sep 2018. Turkey Domestic Borrowing Cost: Cash Borrowing: Annual Compound: Average data is updated monthly, averaging 11.121 % pa from Jan 2003 (Median) to Oct 2018, with 190 observations. The data reached an all-time high of 57.922 % pa in Mar 2003 and a record low of 5.770 % pa in Dec 2012. Turkey Domestic Borrowing Cost: Cash Borrowing: Annual Compound: Average data remains active status in CEIC and is reported by Turkish Treasury. The data is categorized under Global Database’s Turkey – Table TR.M006: Domestic Borrowing Cost.

The Mexico Home Equity Loan market, valued at approximately $X million in 2025 (estimated based on provided CAGR and market size), is projected to experience robust growth, exceeding a 5% compound annual growth rate (CAGR) through 2033. This expansion is fueled by several key drivers. Rising homeownership rates in Mexico, coupled with increasing awareness of home equity loans as a financing option, are significantly contributing to market growth. Furthermore, the growing middle class with increased disposable income is seeking financing options for home improvements, debt consolidation, and other large purchases, thus boosting demand. The availability of diverse loan products, including fixed-rate loans and home equity lines of credit (HELOCs), offered by a range of providers such as commercial banks, financial institutions, credit unions, and other creditors, further enhances market accessibility. The increasing adoption of online loan applications and disbursement processes streamlines the borrowing experience, contributing to market expansion. However, certain challenges temper the market's growth trajectory. Economic instability and fluctuating interest rates can impact borrowing costs and consumer confidence, potentially hindering loan uptake. Stringent lending regulations and credit scoring requirements may also restrict access to loans for certain segments of the population. Despite these constraints, the long-term outlook for the Mexico Home Equity Loan market remains positive, driven by sustained economic growth and evolving consumer borrowing behaviors. The increasing sophistication of financial products and services, combined with a growing understanding of home equity as a valuable asset, positions the market for continued expansion in the coming years. The competitive landscape includes established players like Bank of America and regional banks like Bank of Albuquerque, fostering innovation and consumer choice. Recent developments include: On August 2022, Rocket Mortgage, Mexico's largest mortgage lender and a part of Rocket Companies introduced a home equity loan to give Americans one more way to pay off debt that has risen along with inflation. Detroit-based Rocket Mortgage is enabling the American Dream of homeownership and financial freedom through its obsession with an industry-leading, digital-driven client experience, On February 2023, Guild Mortgage, a growth-oriented mortgage lending company originating and servicing residential loans since 1960, increased its Southwest presence with the acquisition of Legacy Mortgage, an independent New Mexico-based lender. With this acquisition, the Legacy Mortgage team can offer borrowers a broader range of purchase and refinance loan options, including FHA, VA, USDA, down payment assistance programs, and other specialized loan programs.. Key drivers for this market are: Rise in the price of Housing Units increasing Home Equity loan demand by borrower, Decline in Inflation and lending interest rate reducing lender risk. Potential restraints include: Rise in the price of Housing Units increasing Home Equity loan demand by borrower, Decline in Inflation and lending interest rate reducing lender risk. Notable trends are: Financial And Socioeconomic Factors Favouring The Market.

Dillard's Inc.'s strong financial performance and favorable market conditions suggest continued growth, including increased sales and improved margins. However, risks such as economic downturns, competition, and disruptions in the supply chain could impact its performance. Rising interest rates may also increase borrowing costs.

Executive Summary The Canada Deposit Insurance Corporation (CDIC) helps safeguard the stability of the financial system by providing deposit insurance against the loss of eligible deposits at member institutions in the event of failure, and by ensuring the orderly resolution of troubled member institutions. Canada’s economy is facing continued headwinds due to global and domestic factors, including tighter monetary policy, rising interest rates, geo-political tensions, and low housing affordability. In 2022, this resulted in cost-of-living pressures and a decline in real and financial asset values. For Canadian businesses, the year ahead outlook is cautious. Businesses continue to navigate a tight labour market and worker skill shortages. Borrowing costs are on the rise. Real business investment in Canada continues to lag behind pre-pandemic levels. CDIC’s member institutions are facing a period of economic uncertainty. However, member institutions are in stable financial condition due in part to capital and liquidity buffers and well-regulated funding standards for members. Nonetheless, CDIC will continue to focus on strengthening its readiness to respond to a variety of these circumstances and possible shocks to the financial system. Alongside these conditions, the pace of digitalization and innovation in the financial sector is resulting in new financial products, services, and players, which are fundamentally changing the financial sector landscape. CDIC will work proactively to ensure that the deposit insurance, resolution frameworks, and operations remain fit for purpose. CDIC will also strive to increase awareness of deposit insurance to maintain depositor confidence and reinforce financial sector resilience as the landscape continues to evolve. The digitalization of finance has implications for how Canadian depositors access their money and for the security of their data against cyber threats. To maintain depositor confidence, CDIC is transforming its technological capabilities to increase the speed, security, and convenience of access to insured deposits in the event of a member failure. CDIC is also evolving its workplace to respond to changes in the operating environment. There has been an acceleration of technological and cultural changes for all organizations, with competition for talent at an all-time high. CDIC will continue to implement strategies to attract and retain top talent including through Indigenous partnerships to ensure that its employees are representative of Canada’s diverse population. As CDIC continues to experiment with a hybrid work model, CDIC will continue to adapt its technology, operations, and skills training across the organization to maintain flexibility for staff and capability to fulfill its mandate to serve Canadians. CDIC will continue to embed Environmental, Social, and Governance (ESG) principles and initiatives into its operations to foster long-term sustainability and resiliency. CDIC will focus on three strategic objectives for the 2023/2024 to 2027/2028 planning period, anchored to the Corporation’s mandate as deposit insurer and resolution authority: 1 — Be resolution ready Being resolution ready involves having the necessary processes, tools, systems, and financial capacity, as well as the right people to allow CDIC to resolve a member institution if necessary. This is important because CDIC’s role within Canada’s financial safety net intensifies during times of economic hardship or uncertainty and being resolution ready is a key element in promoting financial stability. 2 — Reinforce trust in depositor protection Depositor confidence in the safety of their deposits is essential to CDIC’s mission to serve Canadians, and for the stability of the financial sector. CDIC will reinforce trust in depositor protection by anticipating and responding to innovation in the financial sector to ensure that the deposit insurance and resolution frameworks, as well as CDIC’s operations, remain fit for purpose to maintain depositor confidence. 3 — Strengthen organizational resilience Strengthening organizational resilience involves addressing internal and external factors that can impact CDIC’s technologies, people, and culture. CDIC will enhance the efficiency and effectiveness of its systems, technology, operations, and skills training to ensure that the Corporation can continue to fulfill its mandate while being prepared for the workplace of tomorrow. In fiscal 2023/2024, CDIC’s operating budget will be $89.1 million, and its capital budget will be $3.8 million. CDIC maintains ex ante funding to cover possible deposit insurance losses. The amount of such funding is represented by the aggregate of CDIC’s retained earnings and the provision for insurance losses. CDIC’s ex ante fund totalled $7.9 billion (73 basis points of insured deposits) as at December 31, 2022. The Corporate Plan anticipates and responds to the evolving operating environment and risks facing CDIC and supports the Corporation’s achievement of its mandate while striving to maintain Canadians’ confidence that their eligible deposits are protected.

Carbon-Linked Loan Origination Market Outlook

According to our latest research, the global carbon-linked loan origination market size reached USD 137.2 billion in 2024, reflecting the surging demand for sustainable finance products across industries. The market is expanding at a robust CAGR of 21.8% and is projected to reach USD 1,009.6 billion by 2033, driven by stringent environmental regulations, corporate net-zero commitments, and increasing investor emphasis on ESG (Environmental, Social, and Governance) criteria. The rapid adoption of green and sustainability-linked financing mechanisms, coupled with innovative origination platforms, continues to propel the growth trajectory of the carbon-linked loan origination market worldwide.

One of the primary growth factors fueling the carbon-linked loan origination market is the accelerating shift towards sustainable finance, as corporations and financial institutions align their portfolios with global climate targets. The proliferation of green bonds and sustainability-linked loans has created a fertile ground for the development of carbon-linked loan products, which tie borrowing costs or terms directly to the borrower's environmental performance. In particular, the integration of carbon intensity metrics and emissions reduction targets into loan agreements has incentivized borrowers to adopt cleaner technologies and improve operational efficiency. This alignment of financial and environmental objectives is not only enhancing the attractiveness of carbon-linked loans but also driving innovation in origination processes and risk assessment methodologies.

Another significant driver is the evolving regulatory landscape, particularly in regions such as Europe and Asia Pacific, where governments and supranational bodies are introducing mandatory disclosure requirements and taxonomy frameworks for sustainable finance. These regulatory initiatives are compelling financial institutions to incorporate climate risk considerations and carbon footprint assessments into their lending decisions. As a result, banks and non-banking financial institutions are investing heavily in digital origination platforms, advanced analytics, and third-party verification services to streamline the origination of carbon-linked loans. The growing availability of reliable carbon accounting data and standardized reporting tools is further enhancing transparency and investor confidence in the market, paving the way for greater scalability and cross-border adoption.

Additionally, the rising demand from corporates and SMEs for financing that supports their decarbonization strategies is catalyzing the expansion of the carbon-linked loan origination market. Many organizations are setting ambitious science-based targets and seeking external capital to fund renewable energy projects, energy efficiency upgrades, and low-carbon infrastructure. Carbon-linked loans offer a compelling value proposition by providing financial incentives for meeting or exceeding emissions reduction milestones. This market dynamic is being reinforced by the increasing participation of institutional investors and asset managers who are allocating capital to sustainable lending products as part of their ESG mandates. The resulting virtuous cycle of borrower demand, lender innovation, and investor interest is expected to sustain the market’s high growth rate over the coming decade.

Regionally, Europe remains at the forefront of the carbon-linked loan origination market, accounting for the largest share in 2024, followed by North America and Asia Pacific. The European market’s leadership is underpinned by robust regulatory frameworks, active policy support, and a mature ecosystem of sustainability-focused financial institutions. Meanwhile, Asia Pacific is emerging as a high-growth region, fueled by government-led green finance initiatives and the rapid industrialization of major economies such as China, India, and Japan. North America is also witnessing significant momentum, particularly in the United States, where corporate sustainability commitments and innovative fintech solutions are driving market expansion. Latin America and the Middle East & Africa are gradually catching up, supported by cross-border collaborations and growing investor awareness of climate-related risks and opportunities.

Loan Type Analysis

The carbon-linked loan origination market is segmented by loan type into green loans, sustainability-linked loans, trans

Turkey Domestic Borrowing Cost: Cash Borrowing: Annual Compound: Year to Date data was reported at 15.831 % pa in Oct 2018. This records an increase from the previous number of 15.556 % pa for Sep 2018. Turkey Domestic Borrowing Cost: Cash Borrowing: Annual Compound: Year to Date data is updated monthly, averaging 11.004 % pa from Jan 2003 (Median) to Oct 2018, with 190 observations. The data reached an all-time high of 54.537 % pa in Apr 2003 and a record low of 6.384 % pa in Feb 2013. Turkey Domestic Borrowing Cost: Cash Borrowing: Annual Compound: Year to Date data remains active status in CEIC and is reported by Turkish Treasury. The data is categorized under Global Database’s Turkey – Table TR.M006: Domestic Borrowing Cost.

Companies operating in the third-party real estate industry have had to navigate numerous economic headwinds in recent years, notably rising interest rates, spiralling inflation and muted economic growth. Revenue is projected to sink at a compound annual rate of 0.6% over the five years through 2025, including an estimated jump of 1.2% in 2025 to €207.6 billion, while the average industry profit margin is forecast to reach 35.1%. Amid spiralling inflation, central banks across Europe ratcheted up interest rates, resulting in borrowing costs skyrocketing over the two years through 2023. In residential markets, elevated mortgage rates combined with tightening credit conditions eventually ate into demand, inciting a drop in house prices. Rental markets performed well when house prices were elevated (2021-2023), being the cheaper alternative for cash-strapped buyers. However, even lessors felt the pinch of rising mortgage rates, forcing them to hoist rent prices to cover costs and pricing out potential buyers. This led to a slowdown in rental markets in 2023, weighing on revenue growth. However, this has started to turn around in 2025 as interest rates have been falling across Europe in the two years through 2025, reducing borrowing costs for buyers and boosting property transactions. This has helped revenue to rebound slightly in 2025 as estate agents earn commission from property transactions. Revenue is forecast to swell at a compound annual rate of 3.7% over the five years through 2030 to €249.5 billion. Housing prices are recovering in 2025 as fixed-rate mortgages begin to drop and economic uncertainty subsides, aiding revenue growth in the short term. Over the coming years, PropTech—technology-driven innovations designed to improve and streamline the real estate industry—will force estate agents to adapt, shaking up the traditional real estate sector. A notable application of PropTech is the use of AI and data analytics to predict a home’s future value and speed up the process of retrofitting properties to become more sustainable.

The Direct Real Estate Activities industry have come up against numerous headwinds in recent years, ranging from the COVID-19 outbreak in 2020 to the high base rate environment in the years since, which has inflated borrowing costs for potential buyers. This is a sharp contrast to the ultra-low interest environment seen over the decade following the 2008 financial crisis. Still, revenue is forecast to edge upwards at a compound annual rate of 0.6% over the five years through 2025 to €622.9 billion, including an anticipated rise of 0.8% in 2025. Despite weak revenue growth, profitability remains strong, with the average industry profit margin standing at an estimated 18.9% in 2025. Central banks across Europe adopted aggressive monetary policy in the two years through 2023 in an effort to curb spiralling inflation. This ratcheted up borrowing costs and hit the real estate sector. In the residential property market, mortgage rates picked up and hit housing transaction levels. However, the level of mortgage rate hikes has varied across Europe, with the UK experiencing the largest rise, meaning the dent to UK real estate demand was more pronounced. Commercial real estate has also struggled due to inflationary pressures, supply chain disruptions and rising rates. Alongside this, the market’s stock of office space isn’t able to satisfy business demand, with companies placing a greater emphasis on high-quality space and environmental impact. Properties in many areas haven't been suitable due to their lack of green credentials. Nevertheless, things are looking up, as interest rates have been falling across Europe over the two years through 2025, reducing borrowing costs and boosting the number of property transactions, which is aiding revenue growth for estate agents. Revenue is slated to grow at a compound annual rate of 4.5% over the five years through 2030 to €777.6 billion. Economic conditions are set to improve in the short term, which will boost consumer and business confidence, ramping up the number of property transactions in both the residential and commercial real estate markets. However, estate agents may look to adjust their offerings to align with the data centre boom to soak up the demand from this market, while also adhering to sustainability commitments.

The Direct Real Estate Activities industry have come up against numerous headwinds in recent years, ranging from the COVID-19 outbreak in 2020 to the high base rate environment in the years since, which has inflated borrowing costs for potential buyers. This is a sharp contrast to the ultra-low interest environment seen over the decade following the 2008 financial crisis. Still, revenue is forecast to edge upwards at a compound annual rate of 0.6% over the five years through 2025 to €622.9 billion, including an anticipated rise of 0.8% in 2025. Despite weak revenue growth, profitability remains strong, with the average industry profit margin standing at an estimated 18.9% in 2025. Central banks across Europe adopted aggressive monetary policy in the two years through 2023 in an effort to curb spiralling inflation. This ratcheted up borrowing costs and hit the real estate sector. In the residential property market, mortgage rates picked up and hit housing transaction levels. However, the level of mortgage rate hikes has varied across Europe, with the UK experiencing the largest rise, meaning the dent to UK real estate demand was more pronounced. Commercial real estate has also struggled due to inflationary pressures, supply chain disruptions and rising rates. Alongside this, the market’s stock of office space isn’t able to satisfy business demand, with companies placing a greater emphasis on high-quality space and environmental impact. Properties in many areas haven't been suitable due to their lack of green credentials. Nevertheless, things are looking up, as interest rates have been falling across Europe over the two years through 2025, reducing borrowing costs and boosting the number of property transactions, which is aiding revenue growth for estate agents. Revenue is slated to grow at a compound annual rate of 4.5% over the five years through 2030 to €777.6 billion. Economic conditions are set to improve in the short term, which will boost consumer and business confidence, ramping up the number of property transactions in both the residential and commercial real estate markets. However, estate agents may look to adjust their offerings to align with the data centre boom to soak up the demand from this market, while also adhering to sustainability commitments.