Residential House Price Gains Decelerate, Hit By Cooling China

Tom Burroughes

11 April 2018

Average global house price gains decelerated in 2017, rising 4.5 per cent, down from the 7 per cent growth rate a year earlier.

Annual price growth rates of 20 per cent or more was seen in only a few areas, global real estate consultancy Knight Frank said in its global residential cities index report.
Chinese cities registered a marked slowdown in 2017 averaging 1.6 per cent growth; US cities averaged 6.3 per cent growth in 2017, it said.

The deceleration of Chinese cities’ price growth hit the overall figure, the report continued.

“In 2016, the 15 Chinese cities tracked by the index averaged 23 per cent growth year-on-year. In 2017, the same 15 cities averaged 1.6 per cent growth. Chongqing is now the frontrunner, with previous hot markets such as Shenzhen and Beijing slipping down the rankings,” the report said.

Berlin, the German capital, led the price rise rankings with a 21 per cent year-on-year gain last year.

Strong population growth, a stable economy, record low unemployment and robust interest from overseas investors are together propelling prices higher in Berlin, Knight Frank said.

In North America, a rise in interest rates appeared not to have dented the market.

Across the 15 US cities tracked, prices rose 6.3 per cent on average in 2017. Seattle and San Francisco are out in front, prices ended the year 12.7 per cent and 9.3 per cent higher respectively.
Vancouver rebounded from 21st to fourth place this quarter as supply shortages reignited price growth.