Although the US housing market is showing a slight recovery house prices are generally still on a worldwide downwards trend reports the Global Property Guide.
“Asia is weakening, and house price falls in the worst-hit European countries are dramatically accelerating” says the guide. (see table below.)
The figures that the GPG produce are adjusted for inflation; they are therefore a more accurate reflection of the situation than relying on purely nominal price data.
For example, the UK nominal data based on the Nationwide Building Society shows a slight improvement from a year-on-year price fall of 1.16% last year to a smaller drop of 1.07 in Q2 this year. But when adjusted for inflation it shows that house prices fell by 5.3% year on year to Q2 2011 and fell by 3.42% year on year to Q2 this year. That shows that when taking inflation into account, although things are improving (if you already own a house) in the UK we are still firmly in negative territory and there’s a longer way to go than mere nominal figures would indicate.
In Europe as a whole house prices fell in 15 of the 22 countries for which data was available. Ireland was the big loser where its residential property index dropped like a stone by 16.85% y0y to Q2 2012. It also fell by 2.91% within Q2.
Then came Spain (-13.18%), Greece (-11.92%), Portugal (-10.95%), Warsaw, Netherlands (-10.12%), Poland (-8.19%), and Cyprus (-7.68%), the Slovak Republic (-5.61%) and Sweden (-4.18%) with all but the Slovak Republic seeing bigger house price falls this year than last year.
But for North America the recovery is here says the Guide.
Houses-FreeFoto.com
The Federal Housing Finance Agency’s seasonally adjusted purchase only price index rose by 1.12% yoy compared to last year’s dismal fall of 8.76%.
Canada also saw price rises with its eleven major cities experiencing a 4.06% rise over the year.
And the growth that Asian countries have seen appears to be running out of some steam. India for example saw a price rise of 6.23%, but compare that with last year’s staggering 22.7% rise.
The strongest performer according to the Guide was Sao Paulo, Brazil, which saw prices advance over the year to Q2 by 15.56%, but this may now be slowing as the final quarter only saw a rise of 2.38%.
On an inflation adjusted measure house prices fell in 25 countries out of the 39 for which data is available and they rose in only 15.
Global Property Guide-2012 Q2
