According to the latest Global Property Guide, Australia recorded the fourth-largest price increase during the year to March beating many of the world’s best and biggest cities of 16.6 per cent. Most Asian and Pacific countries also outperformed their European counterparts this year, with Hong Kong, Singapore and Taiwan taking out the top three spots.
Britain was ranked 10th, Switzerland three places lower and France 17th. The global survey uses price rises after inflation, giving a more realistic picture of actual increases in value. However, it’s not all good news for Australia, with the international property forecaster also warning of continuing volatility and a potential housing bubble in our region.
The Global Property Guide warns that many Australian and New Zealand cities are overvalued.
“The boom is over high effective interest rates are pushing housing prices both in New Zealand and in Australia,” the report’s author, Matthew Montagu-Pollock, says.
“However, yields are still respectable both in Auckland and Sydney so we don’t expect a major downturn,” he says.
Real Estate Institute of Australia president David Airey strongly disagrees that the housing boom is over. “Talk of a bubble or possible collapse in prices is extraordinary,” he says. “There’s no bubble here, it’s absolute rubbish.
“On a daily basis in Australia we have people competing to buy houses there is actually a shortage of property. “Australians value property so highly as a means of security and haven for their families and they can achieve it, unlike the northern hemisphere and other regions, where it is only a dream.”
Global house prices
Year to March 2010 (country, percentage change)
- Hong Kong +27.1
- Singapore +23.9
- Taiwan +18.5
- Australia +16.6
- Israel +12
- Finland +11
- Sweden +9.6
- China +8.2
- Norway +7.6
- Britain +5.4
- New Zealand +1.5