Following a period of recessions and extremely weak growth, emerging Europe seems to be experiencing a recovery. The weather in the market across central and eastern Europe is still unstable, but rather pleasant. The region’s economic forecasts for 2014 look a lot like its weather forecasts. It is clear that the continuing confrontation between Russia and Ukraine is inflicting severe pain not only on both economies — and their people — but is also derailing further recovery in eastern Europe and the countries of the former Soviet Union.

Before looking at economic and property market trends in central and eastern Europe, it is worth throwing some light on sub-regional definitions and regional economic trends. Central and eastern Europe can be divided into three sub-regions, comprising central Europe, south-eastern Europe and the Commonwealth of Independent States (CIS). Central Europe is likely to occupy the leading position, helped by relatively healthy banking sectors,