After seeing massive drops in property values over the past 12 months, a growing number of countries around the world are recording robust recovery, according to new data.
The Global Property Guide’s latest survey showed that 19 out of 36 countries achieved house price increases during the year to the first quarter of 2010. Even those countries that recorded price falls saw the rate of decline slow considerably as the global economy emerged out of the recession.
Finland led the charge in Europe, racking up a solid 11.03% after being badly hit by the global financial crisis. House prices are expected to rally further during the rest of the year, according to the report.
Norway also achieved healthy growth of 7.65% year-on-year, thanks to a massive stimulus package and low interest rates. Luxembourg was not far behind with house prices climbing by 6.63% over the same period fuelled by low interest rates. The UK recorded a 5.43% increase in house prices, while Germany and France recorded a smaller gain of just 0.5%.
“The global housing bust is effectively over,” said the report.
The Global Property Guide's statistical presentation uses price changes after inflation, giving a more realistic picture than the more upbeat nominal figures usually preferred by real estate agents.
However, house prices in the US
were still declining in the first quarter of 2010, according to the report. The Case-Shiller index showed a modest drop of 0.23% in the 12 months to the first quarter 2010 (inflation-adjusted). This was a significant improvement from the fall of 18.68% during the same period last year. Canadian house prices stopped falling in July 2009, although there was a modest house price drop of 0.71% in the 12 months to the first quarter of 2010.
Looking at Asia, the stronger-than-expected rebound in property prices in Hong Kong, Singapore and Taiwan are stoking fears of a housing bubble forming in the region.
Hong Kong surged by 27.15% after inflation – the highest house price increase among all countries surveyed.
“This is a remarkable performance, considering that during the same period a year ago Hong Kong suffered a painful year-on-year drop of 15%,” the report noted. “Analysts have expressed concern, and there is a lot of very un-Hong Kong-like outrage at ‘speculators’.”
The same concerns affect Singapore, according to the Global Property Guide. After being badly hit by the financial crisis, Singapore house prices increased by 23.88% year-on-year to the end of the first quarter. This came after falling 22.7% during the same period last year.
Taiwan's house prices rose 18.46% year-on-year to the first quarter of 2010 – the highest increase ever recorded in the country. This was boosted by an influx of buyers from mainland China after financial cooperation agreements were signed between China and Taiwan.
Source: Global Property Guide
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