In fact, a recent real estate study ranked Moldova as the best place in Europe to invest in real estate in 2025. Lithuania and North Macedonia are nipping at their heels in the rankings though. These conclusions highlight the dynamic state of property investment throughout the continent. Countries such as Moldova are quickly becoming appealing destinations for the initial wave of early investors willing to pursue risk.
Moldova has some of the most appealing property purchasing expenses. There you can buy a house there for only 2.80% of the purchase price! Plus, the country has a 12% income tax on rental income, all adding up to a happy ranking for rental yield. Absolute advantage Moldova boasts low barrier of entry as well as competitive taxation. This potent mix makes it particularly alluring to investors seeking high returns in a burgeoning market.
Lithuania, ranked second, presents lucrative opportunities. The country’s real estate prices are climbing close to double digits—almost 10% year-on-year—in the final quarter of 2023. Indeed, Lithuania offers a gross rental yield of approximately 6.39% per annum. Combined with low purchasing costs of as little as 4.10% ROI, this country offers investors high upside growth potential.
“In Lithuania, the moderate growth rate means that property prices are likely to increase steadily over time, providing a good return on investment,” stated the report.
North Macedonia rounds out the top three with a gross rental yield of 6.47% per annum. This yield is very competitive compared to other European markets. Consequently, it becomes a desirable post for property bureaucrats trying to nail down strong returns for their financial investors.
The research offers an exclusive look into other countries with significant investment opportunity. Andorra, Montenegro, and Bulgaria all boast some of the highest gross rental yields. They’re home to some of the lowest average rental income taxes overall. Serbia, Ireland, and Latvia are leaders with “very good” yield rating. Their gross annual rental yields are well over 7%.
Ireland’s record high yields are being pushed upwards by booming rental prices, while Italy is just behind in third place with a 7.56% rental return. And as attractive and stable its returns are, Italy taxes them a little more at 21% which investors need to carefully weigh when looking at total return potential.
The report highlights the need to look beyond simplistic and binary comparisons when analyzing property investments.
Their study highlighted the significant role of gross rental yield and average rental income tax rate on property investment analysis. It underscored the importance of looking at other critical factors such as vacancy rates, cost of property management, and local market conditions.
Moldova’s real estate market is indicative of this astronomical growth, as rent prices have surpassed 170% of their levels back in 2015. This significant increase is a sign of the high demand for rental properties, making it even more appealing to investors.
Investors are hard at work polishing their game plans for the year ahead. Investors should expect them to pay special attention to Moldova, although it is an embryonic market with considerable high-yield potential. In addition to their firm standings in this ranking, Lithuania and North Macedonia’s leadership highlight their attractiveness as investment destinations.
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