Residential property prices continued to boom in some parts of the world, with the five strongest housing markets in Global Property Guide’s latest global survey during the year to Q2 2016 turning out to be China (+20.38%), New Zealand (+10.43%), Romania (+10.1%), Germany (+9.89%), and Turkey (9.67%).
But while property prices rose in China, New Zealand, much of Europe as well as parts of North America, prices fell sharply in Hong Kong, Russia, Brazil, Egypt, and Mongolia, as the world’s housing markets remain two-tiered.
The biggest year-on-year house-price declines were in Russia (-12.46%), Egypt (-11.2%), Hong Kong (-10.73%), Mongolia (-10.55%), and Montenegro (-10.15%).
During the second quarter of 2016, home prices increased in 30 out of the 46 world’s housing markets which have so far published housing statistics, using inflation-adjusted figures. The more upbeat nominal figures, more familiar to the public, showed house price rises in 34 countries, and declines in 12 countries.
By Region:
According to the Global Property Guide, Europe’s house price boom continues unabated, with six of the ten strongest housing markets in the global survey in Europe. House prices rose in 17 of the 22 European housing markets for which figures were available during the year to Q2 2016.
Property in Romania
Somewhat surprisingly, Romania is now the strongest housing market in Europe and the third best performer in our global survey, amid strong economic growth and the government’s focus on rebuilding public trust. The average selling price of apartments rose by 10.1% during the year to Q2 2016, from year-on-year rises of 11.55% in Q1 2016, 7.74% in Q4 2015, 7.57% in Q3 2015, and 4.83% in Q2 2015. House prices increased 0.77% quarter-on-quarter in Q2 2016.
Property in Germany
Germany’s housing market remains strong, mainly due to housing supply shortages and strong economic fundamentals. The price index for apartments rose by 9.89% during the year to Q2 2016, from annual rises of 6.25% in Q1 2016, 7.62% in Q4 2015, 4.3% in Q3 2015, 4.2% in Q2 2015, and 6.04% in Q1 2015. Apartment prices rose by 3.71% q-o-q in Q2 2016.
Property in Turkey
Turkey’s housing market remained robust, with house prices in Istanbul rising by 9.67% during the year to Q2 2016, after y-o-y increases of 12.2% in Q1 2016, 12.51% in Q4 2015, 13.05% in Q3 2015, 13.9% in Q2 2015, and 13.18% in Q1 2015. House prices increased 0.36% q-o-q in Q2 2016 (note however that the survey’s end-date preceded the July 2016 coup attempt). Turkey’s housing market was boosted by strong foreign investment and a growing population, despite a collapsing currency, dissatisfaction with the government, and geopolitical tensions.
Property in Malta
Malta’s property market is performing very well, buoyed by government measures aimed at supporting property demand, such as the Individual Investor Programme and stamp duty exemption for first time homebuyers. Maltese property prices rose by 7.63% during the year to Q2 2016, up from a y-o-y increase of 3.59% a year earlier. Despite this, property prices declined 5.6% q-o-q in Q2 2016.
Property in Iceland
Iceland remained strong with house prices rising by 6.34% during the year to Q2 2016, at par with an annual rise of 6.19% a year earlier. House prices in Iceland increased 1.17% q-o-q in Q2 2016. Iceland’s economy is expected to grow by a robust 4.2% this year, after expanding by 4% in 2015, 2% in 2014, 4.4% in 2013, 1.2% in 2012, and 2% in 2011, according to the IMF.
Property in Ireland
Ireland’s house prices continued to rise, albeit at a slower pace, with residential property prices up by 6.27% during the year to end-Q2 2016, after y-o-y increases of 7.74% in Q1 2016, 6.53% in Q4 2015, 9.24% in Q3 2015, 10.81% in Q2 2015, and 17.57% in Q1 2015. On a quarterly basis, Irish house prices dropped slightly by 0.9% in Q2 2016.
Property in Montenegro
In Montenegro prices of dwellings in new residential buildings dropped 10.15% y-o-y in Q2 2016, in sharp contrast with an annual rise of 2.38% in the previous year. On a quarterly basis, house prices dropped 0.78% during the latest quarter.
Other European property markets
Other strong European housing markets included Riga, Latvia, with house prices rising by 5.61% y-o-y in Q2 2016, followed by, the Slovak Republic (5.46%), the Netherlands (5.41%), Vilnius Lithuania (5.28%), and the UK (4.82%). All saw positive quarterly growth during the latest quarter. Also, all performed better in Q2 2016 compared to a year earlier.
European housing markets with minimal house price rises included Portugal, with house prices rising by 2.87% during the year to Q2 2016, Tallinn, Estonia (2.75%), Spain (2.22%), Norway (2.04%), Finland (0.92%), and Macedonia (0.72%). All, except Estonia and Macedonia, recorded positive quarterly growth during the latest quarter. All, except Estonia and Norway, showed better performance in Q2 2016 compared to a year earlier.
Europe’s weakest housing markets: Russia remained the weakest housing market in the global survey, with residential property prices plunging by 12.46% y-o-y in Q2 2016, a little worse than last year’s decline of 11.13%. Russia’s house prices fell by 2.27% during the latest quarter. Russia’s housing market continues to suffer from the country’s financial crisis, largely unleashed by low oil prices, but also due to the intervention in Syria and the negative impact of the recent war with neighboring Ukraine.
Other European countries with minimal house price falls included Kiev, Ukrainewith house prices falling by 2.95% during the year to Q2 2016, Greece(1.95%), and Switzerland (-1.15%). All recorded negative quarterly price changes during the latest quarter (Ukraine, -1.58%; Greece, -2.1%; and Switzerland, -1.36%). Despite this, only Switzerland showed worse performance in Q2 2016 compared to a year earlier.
Property in Asia
Asian housing markets are now two-tiered. Five of the eleven Asian markets for which figures are available saw house price increases during the year to Q2 2016. Six Asian housing markets were stronger in Q2 2016 than a year earlier.
Property in China
China’s housing market was the best performer in Global Property Guide’s global house price survey, as house prices surged after the government introduced measures to support the housing market. In Shanghai the price index of second-hand houses surged by 20.38% y-o-y in Q2 2016, in sharp contrast to a decline of 0.12% in the same period last year and the highest annual rise since Q2 2008. During the latest quarter, house prices in Shanghai rose by 6.68%.
Property in Japan
Japan’s housing market remains robust, despite a weak economy. In Tokyo, the average price of existing condominiums rose by 5.7% during the year to Q2 2016, from y-o-y increases of 5.45% in Q1 2016, 1% in Q4 2015, 8.97% in Q3 2015, 6.2% in Q2 2015, and 6.34% in Q1 2015. Residential property prices fell slightly by 0.22% q-o-q in Q2 2016.
Other Asian property markets
Asian housing markets with modest or minimal house price rises included Thailand, with house prices rising by 4.38% during the year to Q2 2016,Vietnam (3.58%), and South Korea (1.07%). Thailand and Vietnam recorded positive quarter-on-quarter growth in Q2 2016 of 2.17% and 1.64%, respectively, while South Korea saw a quarterly decline of 0.07%. Only Thailand showed better performance in Q2 2016 compared to the previous year.
Some Asian housing markets continue to struggle. House prices fell in six of the eleven Asian markets for which figures were available during the year to Q2 2016.
Property in Honk Kong
Hong Kong’s housing market is now the weakest housing market in Asia and the third worst performer in Global Property Guide’s global house price survey. Residential property prices fell by 10.73% during the year to Q2 2016, in sharp contrast with the 16.88% y-o-y rise a year earlier. House prices rose 2.68% q-o-q in Q2 2016.
During the second quarter of 2016, home prices increased in 30 out of the 46 world’s housing markets which have so far published housing statistics, using inflation-adjusted figures. The more upbeat nominal figures, more familiar to the public, showed house price rises in 34 countries, and declines in 12 countries.
Property in Mongolia
Mongolia’s housing market remains depressed, amidst a sharp economic slowdown. The nationwide house prices plunged by 10.55% during the year to Q2 2016, after y-o-y declines of 11.93% in Q1 2016, 12.24% in Q4 2015, 14.54% in Q3 2015, 15.28% in Q2 2015, and 14.28% in Q1 2015. During the latest quarter house prices dropped 3.21%.
Property in Taiwan
Taiwan’s nationwide house prices dropped 4.58% y-o-y in Q2 2016, after an annual decline of 2.16% a year earlier, mainly due to government housing market cooling measures. This was its fifth consecutive quarter of annual declines since 2008. House prices increased 1.59% q-o-q in Q2 2016.
Property in Singapore
Singapore’s housing market is still weak, amidst fragile economy. House prices fell by 2.94% during the year to Q2 2016, after y-o-y declines of 2.35% in Q1 2016, 3.05% in Q4 2015, 3.62% in Q3 2015, 3.35% in Q2 2015, and 3.54% in Q1 2015. House prices fell by 1.21% q-o-q during the latest quarter.
Property in Philippines
In the Philippines, the average price of 3-bedroom condominium units in Makati CBD rose by 2.86% during the year to Q2 2016, in contrast with y-o-y increases of 2% in Q1 2016, 2.96% in Q4 2015, 5.41% in Q3 2015, and 6.61% in Q2 2015 and 5.4% in Q1 2015. Housing prices dropped 3.9% q-o-q during Q2 2016.
Property in Indonesia
In Indonesia residential prices in the country’s 14 largest cities fell by 0.35% y-o-y in Q2 2016, after annual declines of 0.16% in Q1 2016, 0.2% in Q4 2015, 1.49% in Q3 2015, 1.07% in Q2 2015, and 0.26% in Q1 2015. House prices increased slightly by 0.34% q-o-q during the latest quarter. Demand continues to weaken sharply and total supply growth is expected to slow in the coming years.
Property in North America, starting with the USA
North America’s housing markets remain healthy. The U.S. housing market remains strong, despite a weakening of the economic recovery. The S&P/Case-Shiller seasonally-adjusted national home price index rose by 4% during the year to Q2 2016 (inflation-adjusted), after annual rises of 4.26% in Q1 2016, 4.51% in Q4 2015, 4.82% in Q3 2015, 4.3% in Q2 2015, and 4.41% in Q1 2015. House prices increased by 1.89% during the latest quarter. This was supported by Federal Housing Finance Agency’s seasonally-adjusted purchase-only U.S. house price index, which rose by 4.34% during the year to Q2 2016 (inflation-adjusted), slightly down from y-o-y increases of 4.54% in Q1 2016, 5.36% in Q4 2015, 5.68% in Q3 2015, 5.62% in Q2 2015, and 5.29% in Q1 2015. The index was almost unchanged in Q1 2016 from the previous quarter.
Property in Canada
Canada’s housing market continues to grow stronger, despite repeated market-cooling measures. House prices in the country’s eleven major cities rose by 8.4% during the year to Q2 2016, up from 4% the previous year and the biggest annual increase since Q2 2010. House prices increased 4.41% q-o-q in Q2 2016. Home sales, however, dropped 2.9% in July 2016 from the same period last year, the largest decline since April 2013, according to the Canadian Real Estate Association(CREA)
Property in the Middles East
Middle East housing markets weakening sharply of the four Middle Eastern housing markets included in the global survey, all, except UAE, performed worse in Q2 2016 than the previous year. Two countries saw modest house price growth during the year to Q2 2016, while the other two experienced sharp declines in house prices.
Property in Israel
Israel’s housing market is softening sharply, amidst economic slowdown. The nationwide average price of owner-occupied dwellings rose by 3.29% during the year to Q2 2016, a slowdown from a y-o-y rise of 7.66% a year ago and the lowest annual increase since Q1 2014. House prices actually dropped 1.8% q-o-q in Q2 2016.
Property in Qatar
Qatar’s property market is now weakening rapidly, amidst economic slowdown. The nationwide real estate price index rose by a meager 1.29% during the year to Q2 2016, sharply down from y-o-y rises of 9.38% in Q1 2016, 10.76% in Q4 2015, 16.3% in Q3 2015, 21.47% in Q2 2015, and 27.81% in Q1 2015. Property prices fell by 3.84% q-o-q during the latest quarter.
Property in Dubai
Dubai’s residential property prices plunged by 5.79% during the year to Q2 2016, from a y-o-y decline of 11.72% in Q2 2015 and its sixth consecutive quarter of annual declines. House prices fell by 0.63% during the latest quarter. House prices in Dubai are expected to fall further by 10% this year, amidst weaker investor sentiment and weak economic growth, according to Standard & Poor’s.
Property in Egypt
Egypt is now the second worst performer, with the nationwide real estate index plunging by 11.2% during the year to Q2 2016. This is in sharp contrast with the rise of 0.9% in the same period last year. House prices actually plunged by 15.44% during the latest quarter.
Property in New Zealand
New Zealand’s housing market continues to grow stronger and is now the second best performer in the global house price survey. The nationwide median house prices rose by 10.43% during the year to Q2 2016, a sharp rise from a y-o-y increase of 5.19% in the same period last year. House prices rose by 0.58% q-o-q during Q2 2016.
Property in South Africa
Africa. South Africa’s housing market remained weak, amidst economic uncertainty. The price index for medium-sized apartments fell by 0.32% during the year to Q2 2016, its fourth quarter of annual price declines. On a quarterly basis, house prices dropped slightly by 0.05% in Q2 2016. House prices are expected to continue falling in the remaining months of 2016, amidst the continued weakness of the rand, falling foreign investor confidence, and uncertain economic condition.
Property in Latin America, starting with Mexico
Latin America’s property markets are mixed. Mexico’s housing market continued to grow stronger, buoyed by strong demand in resort communities. The nationwide house price index rose by 5.32% y-o-y in Q2 2016, an improvement from an annual rise of 3.43% during the same period last year. On a quarterly basis, house prices increased 2.45% in Q2 2016.
Property in Brazil
Brazil’s housing market remained depressed, amidst the ongoing economic crisis and an uncertain political landscape. In Sao Paulo, house prices fell by 7.59% during the year to Q2 2016, worse than the 3.52% decline seen in a year earlier. It was already its sixth consecutive quarter of falling house prices. Quarter-on-quarter, house prices dropped 1.58% in Q2 2016.
Property in Chile
Chile’s housing market was also down, with the average price of new apartments in Greater Santiago falling by 1.36% during the year to Q2 2016, in contrast with an annual rise of 2.93% a year earlier. On a quarterly basis, house prices dropped 2.62% in Q2 2016.