Knight Frank today launches the Global House Price Index* for Q1 2016. The index monitors and compares the performance of mainstream residential markets in 55 countries across the world.
Results for Q1 2016:
- The index grew by 3.4% on average in the 12 months to March 2016, but top performing countries such as Turkey and Australia are seeing their rate of annual price growth slow.
- Asian markets are stumbling. Singapore, Hong Kong and Taiwan have all seen prices decline by between 3% and 6% in the year to March 2016, a combination of sluggish economic growth, regulatory measures and new supply are restraining price growth.
- The US and the UK are largely treading water, price growth in the first three months of 2016 equated to 0.9% and 1.6% respectively, linked in part to political worries, notably potential Brexit in the UK and the US presidential election.
Nicholas Holt, Head of Research for Asia Pacific, says, “The slowdown in growth across many emerging Asian economies has weighed on residential property markets. Indonesia and Malaysia are feeling the impact of the wider macro-economic slowdown. India continues to suffer from pockets of oversupply and a gap in pricing expectations between developers and buyers. The Chinese market is still seeing polarised performance, where Tier-1 and large Tier-2 cities are seeing price growth; whilst smaller Tier-2 cities, Tier-3 and Tier-4 cities are struggling with high unsold inventory.”
David Ji, Director, Head of Research & Consultancy, Greater China at Knight Frank, says, “In Hong Kong, residential prices have dropped for seven consecutive months by a cumulative 11%, according to provisional figures from the Rating and Valuation Department. We do not consider the sales rebound in the past two months an indication of a general market recovery. We maintain our forecast of a 5-10% drop in the luxury segment and up to a 10% drop in mass residential prices.”
*Weighted by Purchasing Power Parity