Q3 Global House Price Index Dulls Recovery Hopes, but Good News for Portugal

The Global Property Guide has recently released its figures on global housing markets in the third quarter. Their index is inflation adjusted which means it is a more accurate measure of prices than those that we normally see in the industry press.

According to the index, just 11 countries have seen prices rise in the year ending the 3rd quarter. Of those countries, Portugal, Finland and Sweden were the only countries in Europe to have seen prices rises during the period -- rises of 1.48, 0.92 and 0.78 respectively.

The only rise over 10% was in Israel, with prices up 10.15% over the period. Surprisingly Australia (8-cities) and Switzerland saw bigger rises than China. At 4.91 and 4.28 respectively, they beat China's 3.98% by a good margin. Hong Kong, Norway and New Zealand were the only other countries in positive territory with growths of 3.60% (RVD, 3.08% in KHU), 2% and 1.98% respectively.

At the other end of the scale; Latvia and UAE were by far the worst performers, with prices falling 59.70% and 48.05 respectively. The UAE is the most striking of all the data, because it shows the results for the year ending Q3 2008 beside that of year ending Q3 2009, a rise of 61.50 beside a fall of 48.05.

The index has put the recent positive reports on the US and UK markets into perspective; though it covered several indices for each of them, they saw prices fall between 2.18% and 7.45%, and 4.34% to 10.2% respectively. On the upside, the index showed that prices falls are over 1% slower than the same period last year.

Though Irish prices are down, the index gives cause for hope. The decline of 7.20% on the quarter, is slower than the year ending Q2 2009, and the quarterly decline has slowed to 2.93%.

This is by far the most accurate index we have seen so far; it is impartial, inflation adjusted and from a reputable and trusted source. It shows that the positivity contained in the Knight Frank index of prices in the second quarter, was flimsy and probably based on pre-inflation prices.

The GPG results will likely increase demand for Portugal property. Portugal has been among the most popular of all countries with the current wave of buyers, who are favouring the safety of established markets; which makes sense given the below market value offers that are currently in abundance.

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