House price falls during the year to the end of quarter one in 2009 was the worst ever according to the Global Property Guide survey of house prices in 32 countries.
The online property research company said that house prices dropped further around the world during the year to end of Q1 2009, as 'personal consumption expenditure decreased, consumer confidence remained low, credit remained tight and the unemployment rate worsened'.
Among the 32 countries in the survey of house prices, 27 recorded price falls during the year to the end of the first quarter of 2009, in real terms.
The Global Property Guide uses price-changes after inflation for its survey.
It said during the year to end-Q1 2009, price falls of more than 10% occurred in 12 countries, worse than the previously worst-ever year to end of last quarter of 2008 when there were eight price falls above 10%.
However, only 7 countries saw price falls of above 5% during the first quarter versus 8 countries during the previous quarter last year although some individual price declines were much higher.
It said there were 'amazing' price declines in Latvia, Dubai and Singapore.
It said: 'Latvia is in surprisingly deep trouble. Average apartment prices in Riga declined an astonishing 50% over a year earlier, to €747/sq m, with a 30% drop during the quarter. Latvia is in deep recession, with its economy contracting 18% in Q1 2009'.
The survey said Dubai’s economy is closely tied to the global market. As uncertainties piled up, demand for properties collapsed. House price falls during year to end Q1 2009 were the worst ever.
Among Asian countries, Singapore’s housing market suffered the most. House prices plunged 23% in real terms over a year earlier, and 13% over a quarter earlier. This is the biggest decline since 2000. The survey said that Singapore is heavily dependent on exports. When the global financial crisis began, demand waned. In Q1 2009, Singapore’s economy contracted by 10.1%, mainly due to a decline in manufacturing production.
Nor is there any clear sign of recovery in the US housing market. The S&P/Case-Shiller House price index dropped by 19% (inflation-adjusted) to end-Q1 2009 over a year earlier. Case-Shiller’s figures also show a larger decline in the first quarter of 2009 (6.5%) than during the last quarter of 2008 (4.5%).
The Case-Shiller Index is based on data from county assessors and record offices and emphasizes urban areas.
However the survey also found that despite the grim situation in the global market, a number of countries have remained resilient.
Switzerland’s decrease in interest rates, and a surge in the number of foreign residents, kept property demand stable.
House prices in Thailand, Austria and Israel bounced back during the year to end-Q1 2009. In Thailand, the price of single detached houses with land are up 4% in Q1 2009 compared to the same period last year. This is the first increase since 2006.
National house prices in Austria are up 3%, after falling by an average of 3% in 2008. House prices in the capital, Vienna, have continued their upward trend, rising nearly 3% during a single quarter, in Q1 2009. After consecutive falls in the last two quarters of 2008, Israel’s house prices rose 3% in Q1 2009.
For more information to the guide and individual country reports go to www.globalpropertyguide.com