Asia-Pacific markets led the patchy recovery in home prices in the third quarter with an average increase of 9.9 percent, based on the global house price index by Knight Frank.
For the first time since 2008, prices in all six world regions tracked by Knight Frank saw increases in Q3. Asia-Pacific markets topped the list of gainers, while European markets were at the bottom of the list with only a 0.8 percent increase.
Some property consultants said the mainland market was the smartest option for investors in luxury properties with budgets of between HK$10 million to HK$20 million. Investing in the mainland had high risks, as well as high rewards depending upon the timing and location.
Price gains in Shanghai and Beijing were driven by a flood of liquidity and historically low interest rates. London-listed property consultancy firm DTZ said the 29,000 yuan psm price tag of flats in the upmarket Chaoyang district in Beijing at the start of the year has already risen to 40,500 yuan psm.
As the year comes to a close, global worldwide home prices continue to grow, though at a slower rate, said Knight Frank, adding that the average annual price increase worldwide fell to 3.1 percent in Q3 from 4.3 percent in Q2.
“In the United States, annual price inflation has fallen back to 0.6 percent, compared to 4.2 percent in the second quarter of 2010; average prices in the US now stand at their mid-2003 level,” said Liam Bailey, head of residential research at Knight Frank.
“Whilst the weakening of growth in the third quarter is partly due to the end of the government’s tax incentive for first-time buyers, the additional issue of high supply volumes, much of it hidden due to pending foreclosures, is continuing to blight the housing market.”
Source : Propertyguru – 29 Dec 2010