Housing Markets worldwide

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The International real estate price boom that has seen investors heading buying overseas property could be at an end according to the latest Global Property Guide survey of house price indicators. 21 countries in the guide saw decreased in house prices however 13 countries in house price indices saw prices rise during the year to end Q1 2008. It is clear that where house prices are not falling, they are clearly losing momentum.

The house price fall ( 1Q 2008 price index) after inflation adjusted :-

1. Latvia (Baltic) * –32.2 , 2. US * -4.2 to –18.1 , 3. Ireland * –13.2 , 4. Luxemburg * –5.8, 5. Portugal * –4.2 , 6. Malta * –4.9, 7. UK * –0.7 to –2.1, 8. Japan * 4.1 (2.9 inflation adjusted) down from 7.8 (7.9 inflation adjusted national index * –1.9)

Inflation woes

In nominal terms, 28 countries saw their housing prices rise during the year to end-Q1 2008, while only 6 saw prices fall. However, when property prices are adjusted for inflation, the picture looks entirely different. Skyrocketing oil, food and commodity prices have pushed inflation up around the world.

Nominal house price fall in:-

Ukraine * from 79.5 to 18.2 (real value fell by –6.4.)
Norway
Spain
Greece
South Korea
New Zealand
Indonesia
South Africa
Israel
Estonia
Lithuania
Nominal House Price Rise in:-

China (Shanghai) * +40.5
Bulgaria * +31.6*
Hong Kong * +31.1
Singapore * +29.8
Cyprus
Australia
Taiwan
Top performing  housing markets (price after inflation)

Slovakia
Causes of the downturn

Gap in market rental and loan installment too extreme
High purchasing cost compares to rent.
Tread of increase in interest rate, over inflationary through adjustment in monetary policy
Unsound regulatory and banking practices led over lending.
Prospects

The House price collapse exposes the banking industry to collapse, until this is cleared the housing market worldwide will continue to go down.
Good luck.

 

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