The rise in house prices during the pandemic increases the fear of a new bubble worldwide in the sector. And the increase has been the largest since the fourth quarter of 2006, with special strength in Turkey, New Zealand, Canada or Singapore.
According to Knight Frank's Global House Price Index report, prices rose an average of one 7,3% March to March, with Turkey leading the way with growth of 32%, followed by New Zealand with the 22,1%. In fifth place was the USA, with a rise in the prices of 13,2%, its biggest increase since December 2005.
In Asia, Singapore posted the largest price increase with a 6,1%, followed by South Korea with a 5,8% and Japan with a 5,7%. Hong Kong, the most expensive real estate market in the world, experienced a growth of 2,1%. The index compares average prices across 56 countries and territories.
Why this real estate boom in the middle of a pandemic? Una de las explicaciones directas del estudio se encuentra en el fiscal and monetary stimulus masivo para impulsar las economías durante la crisis sanitaria. The counterpart, fear of the bubble, which has led several countries to apply measures to cool the market.
New Zealand, for example, has removed tax incentives for real estate investors and the government expects home price inflation to slow to just 0,9% en junio del próximo año. Also China, which has adopted a series of measures to curb bank loans to the sector.
The report points out that “with governments taking action and fiscal stimulus measures that will end later this year in various markets, buyers' confidence is likely to be less exuberant”. further, the threat of new covid variants must be taken into account and possible delays in vaccination can put further downward pressure on price growth.