Thinking of buying or selling a property in Europe? Investing in European real estate has long been a favorite strategy for German investors looking to diversify their portfolios beyond the domestic market. In 2026, this trend has accelerated, driven by a desire for capital preservation, higher rental yields, and the growing allure of the short-term vacation rental (Airbnb) market.
While the German domestic market remains stable, investors are increasingly looking south and east, seeking locations where property prices are more accessible and the “sunshine factor” provides a built-in safety net for tourism-based income.
1. Spain: The Eternal Favorite
Spain remains the undisputed #1 destination for German capital. In 2022, Germans accounted for over 10% of all foreign property purchases in Spain, a figure that continues to climb.
Key Hotspots:
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Mallorca (Balearic Islands): Often jokingly called Germany’s “17th Federal State,” Mallorca offers unmatched connectivity. German investors focus on luxury fincas in the interior and high-end apartments in Palma and Andratx.
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Costa del Sol (Marbella/Málaga): Attracts those seeking a “lifestyle investment.” The area is a hub for golf and luxury living, providing consistent high-season rental demand.
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Tenerife (Canary Islands): Popular for its “eternal spring” climate, ensuring year-round Airbnb occupancy rates that defy European seasonal slumps.
Why Germans Buy Here:
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Quality of Life: A relaxed Mediterranean lifestyle and over 300 days of sunshine.
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Connectivity: Dozens of daily direct flights from almost every major German city.
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The Airbnb Factor: Spain is a global tourism powerhouse. Investors leverage professional management companies to run high-yield Airbnbs, often covering their mortgage costs through summer rentals alone.
2. Austria: The “Safe Haven” Alpine Retreat
For those who prefer mountains to beaches, Austria offers a stable, familiar, and highly regulated market.
Key Hotspots:
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Tyrol (Kitzbühel/St. Anton): The pinnacle of Alpine luxury. Germans buy here for both winter skiing and summer hiking.
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Salzburg Region (Zell am See): Offers lakeside luxury combined with proximity to world-class ski slopes.
Why Germans Buy Here:
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Legal Security: The Austrian legal system is very similar to Germany’s, providing a “home field” advantage in terms of contracts and property rights.
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Inflation Hedge: Real estate in premium Alpine resorts has historically shown incredible resilience against economic downturns.
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The Airbnb Factor: Austria’s “dual-seasonality” is the big draw. A chalet in Tyrol can be rented for premium rates during the ski season and again in the summer for hikers, ensuring nearly year-round cash flow.
3. Croatia: The Rising Adriatic Star
Croatia has seen a massive surge in German interest since its entry into the Schengen Area and the adoption of the Euro in 2023.
Key Hotspots:
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Istria (Poreč/Rovinj): Reachable by car from Southern Germany in just 6–8 hours, making it the “commutable” Mediterranean.
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Dalmatia (Zadar/Split/Hvar): Known for its rugged beauty and thousands of islands.
Why Germans Buy Here:
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Value for Money: While prices are rising, they remain significantly lower than in the French Riviera or Italy.
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Accessibility: The ability to drive to your holiday home is a massive psychological and practical plus for German buyers.
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The Airbnb Factor: Croatia’s coastal property market is heavily geared toward tourism. Many new developments are specifically designed as “Apart-hotels” or luxury villas intended for the short-term market, often yielding 5–7% gross returns.
4. Greece: High Yields and Golden Visas
Greece has become a “yield play” for German investors looking for undervalued assets with high growth potential.
Key Hotspots:
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Athens (Riviera/City Center): Investors buy apartments in the center for the booming Airbnb city-break market.
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Crete and Rhodes: Large islands with long tourist seasons and established infrastructure.
Why Germans Buy Here:
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Price Appreciation: Greece is still recovering from its decade-long crisis; prices are climbing but have not yet peaked.
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Tax Incentives: Various schemes for foreign retirees and “Digital Nomad” visas make it attractive for long-term stays.
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The Airbnb Factor: In Athens, the Airbnb market is exceptionally dense. A well-located apartment near the Acropolis can achieve occupancy rates upwards of 80%, providing a lucrative income stream in a Euro-denominated market.
5. Portugal: The Tech & Lifestyle Hub
Portugal appeals to a younger demographic of German investors—entrepreneurs and digital nomads.
Key Hotspots:
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Lisbon and Porto: Urban investments focusing on renovated historic buildings.
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The Algarve: The classic choice for retirees and families.
Why Germans Buy Here:
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The “Golden Visa” Legacy: Although the program has changed, it put Portugal on the map for global investors.
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Safety and Stability: Portugal consistently ranks as one of the safest countries in the world.
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The Airbnb Factor: Lisbon’s popularity as a “tech hub” and Porto’s status as a top city-break destination ensure that urban Airbnbs stay booked year-round, catering to both business travelers and tourists.
The Airbnb Market
The primary shift in German investment behavior over the last five years is the move away from “buy-and-hold” toward “yield-driven management.” German investors are no longer content with a vacant second home. They demand properties that “work” for them. The Airbnb market provides the perfect solution: it allows the owner to use the property for 2–4 weeks a year while professional agencies handle the high-turnover rental business the rest of the time. In 2026, with inflation-protected assets being a priority, a sea-view apartment that generates €2,500 per month in short-term rent is the ultimate “Property Hotspot” for the savvy German buyer.
