The planet’s housing markets were on balance weaker in the year ending in the second quarter of 2011, according to the first-ever published survey covering the Second-quarter 2011 information, released today by the World Property Guide, which traditionally publishes world housing data before other research houses.
Few EU states ‘ markets rose, most slid, and many worse-hit states like Ireland, Greece and Spain performed even worse this year than last year. The US figures were also disappointing, due to high unemployment.
Worldwide, more housing markets experienced price falls than rises.
Only thirteen out of 39 countries which have so far released data for the period saw home price increases in the year to finish Second-quarter 2011.
Out of 26 states with house price falls, eighteen saw accelerated rates of decline.
The Global Property Guide’s statistics presentation uses price changes after inflation, giving a pragmatic picture than the more hopeful nominal figures often favoured by real estate agents.
HK had the largest increase among all countries surveyed by the Global Property Guide, regardless of cooling measures implemented by the government. House prices were up 19.76% over the year to end Second-quarter 2011, after inflation, with a quarterly rise of 3.51%.
The fundamental dynamic has been Hong Kong’s extraordinarily robust industrial growth, with GDP up 5.1% over 12 months earlier, and very low IRs coming from the HK dollar’s peg to the US dollar.
In Thailand, single-detached houses rose impressively by 7.75% during the year to Second-quarter 2011, after inflation, after last year’s fall of 4.83%.
Thai home prices skyrocketed by 18.29% during quarter 2. This rise potentially resulted from the zero interest loan scheme launched by the Governing body Housing Bank (GHB), aimed at increasing home ownership among lower and middle class earners. However , it ought to be mentioned that the Thai house price database is dated and unrepresentative.
EU housing markets have been feeble
Prices of houses in Europe generally slid lower during the year to the second quarter of 2011. In reality most Western european countries experienced quicker rates of decline than last year.
The info can be grouped into several classes : a) quicker declines this year than last, b) recoveries last year which have turned into declines, c) continued declines, but not so serious as last year, and d) real recoveries (a small category).
A few EU countries which saw house price falls last year performed even worse this year
Ireland had the worst house price decline among all reporting states in our survey over the twelve months to Second-quarter 2011. Home prices were down by 14.84% annual, an even worse decline than the 11.83% fall the year before.
Western european states which experienced weaker performances than the year before include Netherlands (-4.07%), Slovak Republic (-6.49%), Croatia real estate (-6.55%), Spain (-8.43%) and Athens, Greece (-9.88%) (all figures inflation-adjusted).
Some European countries which recovered last year, sunk back this year
In Latvia, standard type flats in Riga fell by 5.40% yearly, after a solid comeback since Second-quarter 2010. Quarter-on-quarter, flat prices were down by 3.80%.
In Britain, average house prices were down by 5.33% annual, after rising 6.04% the year before. The home market commenced rebounding as early as Q4 2009, but started falling again in the last quarter of 2010. The price-falls in the United Kingdom are interesting, because UK interest rates have been low and sterling has fallen, attracting foreign buyers.
In Sweden, home prices slipped by 1.35% over the year to finish Second-quarter 2011, potentially because of the 85% mortgage ceiling introduced last year.
In Portugal, home prices have been falling since Q3 2010, and during the year to Second-quarter 2011, prices dropped by 5.67%.
In Germany, house prices have been slowing since the first quarter of 2011. During the full year to Second-quarter 2011, prices dipped by 0.65%.
In Finland, home prices rose, but were up an insignificant 0.18% annual, down from 10.24% growth over the same period last year.
1 or 2 EU countries have seen their housing markets recover
Norway led the tiny group of Western european states which experienced home price increases, up by 5.93% over the year to end Second-quarter 2011. Norway’s housing market started to rebound in Q3 2009 and has not slowed, driven by low IRs and strong economic growth (4.80% over a year earlier).
Housing markets in Estonia (Tallinn), France and Iceland rose during the year to finish Second-quarter 2011 after suffering house price falls in the year before. In Tallinn, house prices were up 4.94% annual, after last year’s fall of 0.66%. In France (data is from FNAIM), prices of existing dwellings rose 4.65% annual, after a fall of 1.71% the year before. In Iceland, house prices rose a touch by 0.60% year-on-year, after plunging by 9.04% during the year before.
After a decade-long decline in the 1990s, the home market in Switzerland has been stable since 2000. During the year to Second-quarter 2011, flat prices rose by 2.19% annual, up from 0.92% the year before.
Israeli home market softening
Israel home prices were up 5.40% yearly to Second-quarter 2011, but the pace is slowing thanks to the steps taken by Bank of Israel. These include rate hikes (currently 3.25%) and the new limit on prime interest based mortgages (33% of the property’s worth).
During quarter 2, Israeli house prices fell by 3.38%, the steepest decline since the last quarter of 2008. Similarly, the continued increase in the number of building starts, and steps taken by the Ministry of Finance in property taxation, are anticipated to be mirrored in house prices in the course of the year to come,writes tagza.com.