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Global house prices: half the world up, half the world down

The latest survey of the Global Property Guide showed that 17 out of 35 countries recorded increases in house prices over the year to end Q3 2010 (based on inflation-adjusted house price changes). Of the 18 countries that experienced house price falls, 11 recorded slower rates of decline.

The Global Property Guides statistical presentation uses price changes after inflation, giving a more realistic picture than the more upbeat nominal figures usually preferred by real estate agents.



Latvia takes a big leap to the top

After a long and sharp housing crisis, Latvia is finally back in the limelight. Latvia outperformed all countries in the GPG survey, recording a house price rise of 24.73% over the year to Q3 2010. This was in sharp contrast to the 59.70% drop during the same period last year. However, the average Riga apartment price at 610 Euros per square metre in Q3 2010, is still 45% lower than the average price in Q3 2008.

Latvia was the only European country that had a double-digit increase. Following Latvia were Finland and Norway with year-on-year increases of 5.99% and 4.38% respectively. House prices in both countries have been rising since Q3 last year.

The rest of Europe remains weak

Germany, the UK, Switzerland and Denmark had modest increases of only over 1% year-on-year to Q3 2010.

Ireland had the worst annual price decline among countries in the survey, with house prices down 14.94% over the year to Q3 2010. Irish house prices have been falling for the past three years, and the declines show no sign of ending.

Lithuania has not recovered yet. The Ober-Haus apartment price index, which reports apartment prices in Lithuania’s five largest cities, slipped by 10.36% during the year to Q3 2010. Prices were 39.2% below their peak level in Q4 2008. Nevertheless, the recent year-on-year decline is a big improvement on the 31% fall experienced during the same period of last year.