Global Residence Prices Continued to Rise Quickly in 2006

Top the cost was Estonia with an remarkable 54% home cost improve in 2006. This followed typical dwelling price rises of 57% in 2005, and 25% in 2004.

Estonia was followed by Denmark which knowledgeable 23% house price tag rises in 2006, then by Norway (14%) and Ireland (13%). Other nations in northern Europe also had amazing house price boosts, such as Sweden, UK, and Finland.

Early indicators propose that Latvia's powerful property cost progress will carry on in 2006, following 27% property price rises in 2005. This will be verified as soon as official figures arrive in.

Exterior Europe, South Africa, 2004's star performer, continues to knowledge sturdy residence value expansion, with 2006 home price tag rises of 12.7%. However, this is a much cry from the 33% increases recorded in 2004, and the 17% rises of 2005.

Countries attracting immigrants are also going through robust home value boosts, specially Canada (11%), New Zealand (10%) and, to a particular extent, the US (8%) and Australia (six.five%).

Central Europe lags behind

Southern Europe, the favorite destination of 2nd house customers and holidaymakers, is also going through robust property value increases.

France experienced a twelve.5% home cost increase from 3Q 2005 to 3Q 2006, although Spain registered a ten% rise in 2006 and Italy six.six%. Nonetheless house charges in Portugal dipped marginally (-.four%), subsequent a lackluster modern past.

Austria's housing renaissance continued, with six.8% price tag raises in Vienna, soon after eight% price tag rises in the course of 2005.

Most nations in Central Europe, however, remained unexciting. 2006 saw quite small value increasesin Switzerland (2.nine%), Luxembourg (two.nine%), Germany (two.8%) and Poland (2.two%).

Philippines leads Asia

The Philippine true estate market registered the greatest value growth in Asia for the duration of 2006 at eleven.6% (Philippine residence charges had dropped most after the 1997 Asian Crisis).

Indonesia's property rates rose eight.76%, from 3Q 2005 to 3Q 2006. However Indonesian inflation was higher in 2006 at 13%, so in genuine terms Indonesian house charges truly fell.

Singapore's residential property price index rose 7.six% y-o-y to 3Q 2006, the city state's greatest price improve since 2000.

Malaysia and Taiwan are even now muddling by means of, and noticed only marginal price tag increases of one.4% and 1.one%, respectively.

The previous powerful residence cost development in Thailand during 2004 and 2005 arrived to an conclude, as the political crisis spilled over to the economy, and 2006 saw residence price tag falls of nearly one%.

Japan has not witnessed the conclude of far more than a decade of home price tag falls. Commercial property values are soaring in Tokyo and some key metropolitan areas, but in the rest of the region home charges are nonetheless static.

The global property boom is slowing

Several a lot more countries seasoned nominal home price tag boosts in 2006, than value falls. But the tempo of housing value increases in 2006 was usually down on 2005.

A number of nations experienced very significant slowdowns in their housing markets, without having viewing real price falls. Countries in this category, where the value rise fee dropped by more than five proportion factors, incorporate Poland (six.six proportion point reduction on prior fee of home price tag rise), US (5.six% reduction on preceding fee of residence cost boost) and New Zealand (5.02% reduction on 2005's cost-rise charge).

Nevertheless, US house rates showed no real decline in 2006, possibly throughout the yr, or from one particular quarter to the next, in accordance to the OFHEO property cost index, regardless of some press reports to the contrary.

It is tempting to attribute the slowdown in a lot of countries to curiosity price rises, particularly in Europe and the US.

Nevertheless, other forces came into play in some nations. Israel (generally not included in most "global" property price reports) seasoned value declines in 2006 (-four%), after a recovery in 2005. The price tag fall can be attributed to the war with Hezbollah in Lebanon, and other political troubles.

The remarkable upsurge of Hong Kong house prices in 2003 and 2004, and sudden cooling down in 2005 and 2006, also deserve a much better explanation than the normal speculative bubble principle.

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