Globally house prices are experiencing their weakest annual growth for three years, rising by just 0.3% in the year to March 2015, according to the latest international index.
But this figures hides strong performances by a number of key countries, including several in Europe, with growth led by Hong Kong which has seen mainstream prices rise by 19%.
The data from Knight Frank’s global house price index also shows that with some of the larger economies such as Japan, France and crucially China, all experiencing housing market slowdowns this is masking the fact that overall a large number of countries are now recording a more sustainable level of growth.
Around 75% of the countries tracked by the index recorded flat or positive annual price growth in the first quarter of 2015, three years earlier this figure was closer to 47.2%.
The weakest-performing world region is now Russia and CIS with prices down 2.3% on average year on year. On a country basis Ukraine, Cyprus and China occupy the bottom rankings for annual price growth, falling 15.5%, 8.2% and 6.4% respectively.
The report points out that a lack of supply in Hong Kong along with the popularity of smaller apartments due to affordability constraints is behind the acceleration in mainstream prices.
European countries which claimed almost exclusive rights to the bottom half of the rankings for several years are now more evenly spread with seven of the top 10 countries now located in Europe. Turkey, Ireland, Luxemburg and Estonia rank highest, all registering double digit annual growth.
But a two-speed Europe is increasingly evident. Cyprus, Greece, France and Italy sit amongst the 10 weakest performing markets, notable by their absence however are Spain and Portugal. Prices in Spain are now rising at their fastest rate in six years due in part to improved mortgage lending.
While prices continue to soften in China, down 6.4% on average year on year, the volume of sales rose 7% year on year in April on the back of looser monetary policy.
The United States, on the other hand, recorded 4.1% growth in the year to March but with underlying inflation still rising a rate rise is expected later this year.
from http:// www.propertywire.com