Brazil recorded the highest annual increase in house prices, up 15.2% year-on-year, according to Knight Frank.
With the debt crisis raging across Europe, it’s not surprising that the property markets of countries outside the continent did well in 2012.
Topping the list is Brazil, which recorded the highest annual increase in prices, up 15.2% year-on-year. However, it should be noted that the pace of growth is slowing in residential real estate markets across the globe.
According to the latest Knight Frank global house price index, house prices in mainstream residential markets increased by just 0.1% in the three months to the end of September 2012, and by 1% in the last 12 months. This means that the mainstream global property prices stand just 5.2% above the lows hit in the wake of the financial crisis in the second quarter of 2009. Knight Frank says that this stagnation is likely to continue well into 2013.
Along with Brazil, five other markets – Hong Kong, Turkey, Russia, Colombia and Austria – recorded double-digit annual price growth in the year to September. Europe was the only world region to see prices decline, the index shows.
The Eurozone’s 17 member-states have on average seen prices fall by 1.8% in the 12 months to September. Greece landed at the bottom of the rankings, with an 11.7% decline in prices, and has now pushed Ireland off the bottom slot where it has been for five consecutive quarters. Ireland has seen its rate of decline improve, up from –14.3% a year ago to –9.6%.
South America has seen growth of 9.8% and Asia–Pacific is up 4.2%. But the markets in Asia–Pacific are slowing, a result of restrictions put in place by policymakers as cooling measures.
Meantime, the USA is showing signs of growth, said Knight Frank. Prices are now 3.6% higher than in the third quarter of 2011, vacancy rates are at their lowest level since 2005 and housing starts are up 49% year-on-year. However, Everett-Allen warns that the US fiscal cliff could extinguish this hope.
In summary, confidence, affordability and debt are constraining Europe. Strict lending and the looming fiscal cliff may dent the early signs of growth in the USA while regulatory measures in Asia are keeping housing markets in check, she said.
By Rodel Ambas Jr
12 December 2012