The Spain property market is not faring very well in the global competition. The latest Knight Frank Global House Price Index ranks Spain 49th of the 54 markets tracked by the firm, with overall prices down 1.8 per cent in the first quarter and 4.0 per cent lower from a year earlier.
Dubai was the top market listed, posting a 27.7 per cent gain on the year, as investors once again surged into the market. China (17.5 per cent annual increase), Estonia (16.2 per cent), Turkey (13.8 per cent) and Taiwan (12.2 per cent) round out the top performers.
The Index typically generates headlines, but offers little new information, as it essentially compiles existing data on each market. In many cases, the data is comparing apples to oranges, with much different resources and methodologies available in different markets.
But the oft-reported Knight Frank index does provide an interesting comparison of the trends on a global scale, creating a barometer for how housing markets are performing in a competitive context.
In that context, the Index suggests Spain is not doing very well. Dubai, which faced similar issues of huge price drops, an over-reliance on speculators and a massive oversupply of product, has topped the Index for four straight quarters. Turkey, another market that is dealing with on-going political and economic issues, is posting steady gains, including a 2.9 per cent increase in the first quarter, according to Knight Frank.
Overall, the index shows markets improving in markets around the world. For the first time since 2008, no single market recorded price drops of more than 10 per cent in the year, Knight Frank reports.
But Southern Europe continues to struggle, with Cyprus, Croatia, Greece and Italy joining Spain at the bottom of the table. Croatia was the worst performing market in the index, with a drop of 9.7 per cent in the last year. However, the declines are slowing in the European markets, Knight Frank notes.
“We expect to see the index strengthen again in the second quarter,” the agency concludes. “All eyes will remain on central banks, in particular the Federal Reserve, the Bank of England and the European Central Bank. The issue is not when interest rates rise, but the speed and extent to which they do.”