According to Knight Frank’s latest Global House Price Index for Q2, 2020, Turkey leads the annual rankings with prices up 25% year-on-year. But it’s worth noting inflation currently sits at around 12%. European countries occupy eight of the top 10 rankings this quarter with Baltic and Central and Eastern European nations well represented.
New Zealand, Germany and South Korea, three countries that were initially thought to have dealt with the pandemic most effectively registered mixed results. Germany has yet to report Q2 figures, New Zealand slumped from second to 11th place in the rankings between March and June – although it still recorded 9% annual price growth – and South Korea, where price growth was anemic at 0.1% in Q1 has seen annual price growth pick up to 1.3%.
Key Global Index findings include:
- 4.7% – the average annual change in prices across 56 countries and territory
- Turkey leads the annual rankings in the year to Q2 2020
- Eight European countries are in the top ten annual rankings
- New Zealand is Asia-Pacific’s top performing country in terms of annual price growth
- 9% of countries and territories have registered annual price declines in Q2 2020
Knight Frank says these trends suggest the impact of the pandemic on global housing markets is likely to be inconsistent and irregular. Much will depend on the state of the housing market prior to the pandemic, the length and severity of the lockdown and each country or territory’s reliance on international demand, which has dried up in recent months due to travel restrictions.
What to watch in Q3 2020:
- Any sign of a correlation between the length and stringency of lockdowns and price performance
- If reporting rates by national statistics offices improve as national lockdowns reduce in number or if indices are halted due to a lack of transactions
- If markets reliant on tourism and with a high proportion of second homes register weaker price growth