Global house prices converge
Steady price growth is the new norm as the outliers have largely disappeared from our Global House Price Index in recent quarters.
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Over recent quarters Turkey, New Zealand, Canada and Sweden have occupied some of the top positions in our Global House Price Index whilst key Asian markets have dominated the lower ranks. This quarter is no different.
The overall aggregate index has followed a similar narrative, consistently recording 4% annual growth, or thereabouts, for the last two years.
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Yet closer inspection shows the extremes are moderating. The percentage points separating the strongest and weakest performing housing market have narrowed from 33 points in Q3 2015 to 23 this quarter.
Of our top five performing countries, Turkey and Sweden are the only two markets where price growth has slowed compared with last quarter, down from 19% to 14% and from 13% to 9% respectively.
Our index tracks nominal price growth but if we consider real price growth, where inflation is stripped out, New Zealand finds itself in first place with 11% annual growth whilst Turkey – with inflation in excess of 7% – is pushed down into 13th position.
All eyes in the coming months will be on the UK and the US, both housing markets have been level pegging in the last year, recording annual growth of 5.2% and 5.1% respectively.
The outcome of the US presidential election and the negotiations following the UK’s Brexit decision will ultimately determine the confidence of owner occupiers and the flow of investor capital across a large part of the world in the short to medium term.
For the country rankings and our full analysis read the Global House Price Index