KUALA LUMPUR: Housing prices in Asian markets continue to be arrested in the second quarter of 2014 (2Q14) due to cooling measures even as housing prices around the world surge, according to an international residential market research firm.
Global Property Guide said nominal housing statistics show that only 10 out of 44 countries have recorded declining prices on a yearly basis while inflation-adjusted figures show that over half of the countries surveyed recorded a housing price growth. However, most of the slowdown has happened in Asian markets.
“Many housing markets are now considered overvalued. Asian governments in particular are imposing cooling measures to avoid a repeat of the past. However, housing markets in much of the rest of the world are rising faster than before,” said the research firm.
Prices in Singapore, Hong Kong, South Korea and Vietnam fell in 2Q from a year ago.
Singapore’s residential property prices fell by 5.02% in 2Q following an annual decline of 1.68% in 1Q, 0.9% in 4Q13, and year-on-year (y-o-y) increases of 2.01% in 3Q and 2.47% in 2Q.
Meanwhile, Hong Kong’s property prices dipped by 0.86% in 2Q in stark contrast to annual growth of 13.89% from a year ago.
However, in South Korea and Vietnam, housing price drops decelerated. In South Korea, prices fell by 0.37% in 2Q, compared with a decline of 2.59% a year ago, while in Vietnam, prices slipped by a mere 0.03% compared with a 3.55% decline from a year earlier.
Meanwhile, Taiwan’s housing prices rose by only 5.2% in 2Q in comparison with outstanding gains of 14.53% a year ago while in Tokyo, Japan, the growth of house prices was 2.63%, less than half the rate of 5.81% last year.
Similarly, price growth continued to slow in some Southeast Asian countries. In the Philippines, 3-bedroom condominium units in Makati’s central business district saw slower growth in average prices with 2.31% in 2Q compared with 8.6% a year ago.
In Thailand, property prices rose by 2.28% in 2Q compared with 3.76% last year. In Indonesia, housing prices in 14 major cities inched up just 0.74%, in contrast with stronger gains of 6.06% a year ago.
“Likewise, China’s once booming property market is now on the verge of a slump, with the price index of second-hand residential buildings in Beijing rising just 2.31% during the year to 2Q, a sharp slowdown from the robust growth of 11.11% over the same period last year,” it said.
In contrast, Dubai’s housing prices soared by 33.26% on a yearly basis, backed by strong demand. Construction activity is also increasing.
The Global Property Guide 2Q14 housing price survey is part of the research house’s coverage of residential market trends in 101 countries.
This article first appeared in The Edge Financial Daily, on September 26, 2014.