House prices around the world are continuing to soar, with property booms in Europe, North America and some parts of Asia, according to a new study by Global Property Guide.
The research firm revealed that house prices increased in 28 countries in the second quarter of the year and fell in just 11.
Of the five countries to record the strongest property price growth, three were in Europe and the other two were in Asia.
Despite thinking the UK has a difficult property market, Hong Kong saw the highest house price rises in the global market.
Residential property prices in Hong Kong increased by 16.4% in the year to the end of June, a huge reversal on its 0.66% drop in 2014.
Countries with the strongest house price growth
|
Position |
Country |
House price growth |
| 1 | Hong Kong | 16.43% |
| 2 | Ireland | 10.81% |
| 3 | Estonia | 8.99% |
| 4 | Philippines | 6.61% |
| 5 | Iceland | 6.19% |
| 6 | Japan | 6.13% |
| 7 | USA | 5.39% |
| 8 | Israel | 5.22% |
| 9 | New Zealand | 5.19% |
| 10 | Romania | 4.83% |
Of the 20 European countries for which data is available, 13 experienced house price rises in the past 12 months.
Ireland came second overall for global property price growth after witnessing a house price boom, following a difficult year in 2013.
Prices were up by 10.8% in the year to the end of June, causing the OECD to warn that soaring house prices could pose one of the biggest risks to the country’s financial stability.
The think tank stated that an uncontrolled property boom would “increase vulnerabilities, especially if it were associated with further indebtedness”1.
Estonia saw the second biggest price rises in Europe and came third in the global market. This was despite prices levelling compared to last year. In its capital, Tallinn, the average property price increased by 9% in the year to June, much less than the 16.1% rise it experienced over the same period last year.
In Romania, prices grew by 4.8% during the year. Norway, the UK and Germany followed with increases of around 4%.
However, some parts of Europe remained slow, according to the study.
Russia has the second weakest housing market and witnessed the biggest annual drop in prices in Europe.
House prices in Russia fell by 11.1% in the year to June, the biggest annual decline since the fourth quarter (Q4) of 2011.
Ukraine’s property market is struggling, amongst an economic and political crisis.
The average house price in Kiev decreased by 10.6% over the year, and fell by 1.6% between April and June on a quarterly basis. These sharp drops were caused by the high interest rates imposed to tackle hyperinflation.
Other weak property markets in Europe include Greece, Spain, Cyprus and Croatia.
The greatest annual decreases were recorded in the United Arab Emirates (UAE), Russia and Ukraine, falling by 11.7%, 11.1% and 10.6% respectively.
House prices have been declining steadily in Dubai over the last few years, affected by a drop in the price of oil, weaker currencies in Russia and Europe and a lack of housing demand.