Global Property Prices Up

The latest Knight Frank Global House Price Index indicates strong growth among the 53 countries surveyed, with prices rising 4% over the last peak in 2008. Experts note …

The latest Knight Frank Global House Price Index indicates strong growth among the 53 countries surveyed, with prices rising 4% over the last peak in 2008. Experts note that significant growth in emerging markets like Brazil, Indonesia have played a role in pushing up the index, as have powerhouse emerging markets like China and Hong Kong. There has also been improvement in countries like Ireland that have long been suffering during the fallout of the financial crisis. Balancing things out, however, are places that continue to struggle and did not see any growth in the month of September. For more on this continue reading the following article from Property Wire.

A leading index that tracks mainstream residential property prices in 53 countries around the world has exceeded it pre-financial crisis high with a rise of 4.6% over the 12 months to the end of September.

The Knight Frank Global House Price Index now stands 4% above its previous peak in the second quarter of 2008 and 12.7% above its financial crisis low in the second quarter of 2009.

Prices rose on average by 1.5% in the third quarter taking annual price growth to 4.6% and Kate Everett-Allen, head of international residential research, said that this suggests that the world’s housing markets are gaining traction.

Over 69% of the countries tracked by the index recorded positive price growth in the year to September, yet two years earlier this figure was closer to 55%.

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The data shows that the key emerging markets of Dubai, China and Hong Kong recorded the largest annual rise in mainstream prices, increasing by 28.5%, 21.6% and 16.1% respectively.

The performance of a number other emerging markets, most notably Taiwan, Indonesia, Turkey and Brazil, has bolstered the index this quarter. They recorded price growth of 15.4%, 13.5%, 12.5% and 11.9% respectively in the year to September.

Ireland has also seen an impressive rebound and recorded the fifth highest rise in prices in the three months to September with prices rising 4% on average over the three month period. Yet less than two years ago prices in Ireland were falling at a rate of 5.4% each quarter.

Everett-Allen pointed out that during the global financial crisis Asian housing markets largely compensated for the weakness of Europe and the United States. But with the UK and US housing markets now picking up, the Eurozone debt crisis receding, at least for the moment, and prices in many key Asian markets still recording double digit annual price growth, the index is experiencing a strong surge.

‘That said, there remain a number of struggling housing markets. There are still 17 countries where house prices fell in the year to September. All except three were located in Europe. Only Japan, South Korea and New Zealand interrupt Europe’s dominance at the foot of the table,’ Everett-Allen explained.

She also pointed out that risks to the world’s housing markets are numerous. From geo-political concerns to slowing growth rates in key emerging markets there are risks but perhaps the most significant at present is a reduction in policy stimulus by the US Federal Reserve,’ she said.

This article was republished with permission from Property Wire.


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