According to Eurostat, rental prices across the European Union increased by 3.1 percent year over year by the end of the third quarter of 2025, extending an upward trend that has remained consistent since 2010. This sustained growth reflects a persistent imbalance between supply and demand that becomes more pronounced in certain markets. That said, this pattern is not uniform worldwide, which makes it possible to identify clear differences between Europe, the United States, and other pressure points expected in 2026.

‍

Understanding where rental demand is growing most rapidly helps explain how residential decisions are evolving and which factors will shape the market in the near term.

‍

Europe: structural shortages and sustained pressure

‍

Europe’s rental market continues to be shaped by limited housing supply. According to the Emerging Trends in Real Estate Europe 2026 report by PwC and ULI, reduced funding for new construction during 2024 and 2025 will directly affect the volume of housing entering the market in 2026. This constraint coincides with demand that continues to rise, particularly in major cities.

‍

Urban centers such as London, Madrid, Paris, and Berlin concentrate much of this pressure. PwC notes that these cities will continue to attract international residents, mobile professionals, and students, while available housing remains insufficient to absorb this inflow. As a result, rental prices in Europe’s leading capitals are expected to increase between 4 and 6 percent throughout 2026.

‍

Southern Europe shows even stronger momentum. According to the same analyses, countries including Spain, Portugal, and Greece combine limited housing availability with growing demand linked to flexible stays, labor mobility, and international profiles. This dynamic intensifies competition in the residential rental segment and reinforces upward price trends.

‍

Urban concentration

‍

Beyond aggregate figures, rental demand in Europe remains highly concentrated in urban areas. Capital cities and metropolitan regions continue to attract residents due to connectivity, employment opportunities, and strong academic ecosystems. While some surrounding areas are beginning to absorb part of this pressure, the core imbalance persists.

‍

PwC’s assessments indicate that insufficient housing supply in urban centers will remain one of the main drivers of rental demand growth across Europe, with a particularly strong impact on younger renters, international students, and relocated workers.

‍

United States: a phase of rental stabilization

‍

The U.S. market follows a different trajectory. According to Zillow Research, the strong wave of multifamily apartment construction over recent years is beginning to balance supply and demand. As a result, apartment rents are expected to rise by only 0.3 percent in 2026, following a largely flat pricing environment in 2025.

‍

In several Sun Belt cities such as Austin and Phoenix, Zillow even points to potential price declines driven by accumulated oversupply. This situation stands in sharp contrast to Europe, where scarcity remains the dominant force.

‍

That said, this moderation does not apply across all segments. Zillow estimates that rents for single-family homes will increase by around 2.2 percent, as high mortgage rates continue to limit access to homeownership and keep many households in the rental market longer.

‍

Two speeds in the global rental market

‍

Comparing Europe and the United States reveals two distinct market models. Europe faces demand that continues to outpace available housing, while the U.S. enters a phase of gradual adjustment supported by expanded rental stock.

‍

At a global level, Knight Frank projects average prime rental price growth of approximately 3.5 percent in 2026, reflecting a return to more stable conditions following post-pandemic volatility. This projection confirms that demand remains active, although regional behavior varies significantly.

‍

In markets under strong rental pressure, professional property management becomes increasingly relevant. Tools such as Arrento by Lodgerin, a Property Management Software designed for rental operations, help centralize workflows and improve occupancy rates.

‍

Demand as the market driver

‍

Looking ahead to 2026, Europe stands out as the region with the fastest-growing rental demand, driven by structural housing shortages and urban concentration. In contrast, the U.S. market appears more balanced, particularly within the multifamily segment, although certain property types continue to face upward pressure.

‍

Recognizing these regional differences is essential for anticipating market shifts and adjusting strategies in an environment where renting has become a central housing option. While Europe continues to grapple with limited supply, the United States benefits from greater absorption capacity, creating a more stable outlook for renters.