Global housing market still ‘shaky’
London , April 22, 2010
The recovery in global housing markets is still shaky with a number of locations seeing steep growth and others registering price falls during the final three months of 2009, said an expert.
“There remains a very clear polarisation between the locations at the top and bottom of our table,” said Liam Bailey, head of residential research, Knight Frank, the leading UK-based global property consultancy, referring to the recently released Knight Frank Global House Price Index – Quarter 4 2009.
“Five countries posted double-digit growth last year, but nine actually saw prices fall by over 10 per cent,” he added.
“Prices in Hong Kong and mainland China increased by over 25 per cent, driven by a massive injection of liquidity into the economy by the Chinese government’s fiscal stimulus package. Prices do appear to be levelling off though with final quarter increases of only 2.9 per cent in Hong Kong,” Bailey observed.
“The Australian economy has also benefited from China’s rapid recovery from the global recession and the country’s house prices increased by 13.6 per cent, with particularly strong growth of 5.2 per cent in the final quarter of the year.”
“At the other end of the scale, Ukraine and the Baltic states (Estonia, Latvia and Lithuania), as well as Ireland and Dubai, continue to be hit hard by the fall out from the credit crunch and prices corrected sharply last year.
“The positive news for these locations is that prices do seem to have stabilised with most reporting minimal falls or even slight growth in the final three months of the year.”
In Ireland, however, impact of the credit crunch continues to be felt and prices slid a further 8.3 per cent in the last quarter.
“Interestingly, a number of countries that recorded tentative growth earlier in the year saw prices fall back again slightly in the final quarter as their economic recovery wobbled,” Bailey said.
“In the US for example, prices rose on average by almost 3 per cent overall in the second half of 2009, but actually fell by 0.6 per cent in the last quarter.”
“Generally, however, most locations were seeing only very moderate falls by the end of the year,” he continued.
“This suggests that 2010 could mark the beginning of the recovery for those countries where prices were still falling last year. There are, of course, large question marks still hanging over a number economies, particularly in Europe, as the true impact of the credit crunch continues to unravel. We should not take anything for granted, yet,” Bailey concluded. – TradeArabia News Service