A global house price index of 55 countries compiled by the property company Knight Frank shows Spain in bottom place and missing out on a real estate price boom in developed economies. Perhaps it’s just a late starter.
Covid-19 has given global house prices a shot in the arm with significant increases in values in most countries since the pandemic started, especially in developed countries. Spain is one of only two countries in the 55-country index where prices have fallen, the other being India.
“The pandemic-induced housing boom continues with prices rising by 9.2% on average across 55 countries and territories in the year to June 2021,” explains the latest quarterly global house price report published by Knight Frank, who track the performance of over 50 mainstream national housing markets around the world using official data from Central Banks or National Statistic Offices in each country.
Ranking countries by annual house price percentage change, Turkey was at the top with a 29% increase in house prices over 12 months up to Q2 2021, and Spain at the bottom with a decline of 0.9%, though in Spain’s case the time period was 12 months to the end of Q1 – the latest data available*.
The table on the left below gives the full ranking by annualised % change, with Eurozone countries listed in blue to illustrate that belonging to the same monetary area has had little impact on the ranking positions. Spain was last at 55, whilst fellow Eurozone member Slovakia was in 4th place with an increase of 18.6%.
If you rank the countries by change in the last quarter, from highest to lowest, to get an idea of where prices were heading most recently (table on the right) the order is broadly similar, and Spain is still near the bottom but just in positive territory. In this ranking Jersey goes from almost the bottom to first place, and Lithuania goes from 16th to last. Either house prices or the data are volatile in some countries.
The data source for Spain used by Knight Frank is the Spanish government ministry known as MITMA for short, based on valuations, not sales prices. The next chart shows the MITMA house price index based on valuations over the last few years. Prices were cooling down before the pandemic came along and dragged them into negative territory, but the latest numbers suggest prices were starting to recover.
And if you look at the bigger picture, and include the 6 most widely-watched Spanish house price indices, of which MITMA is just one, you get the impression that prices are revving up, even if Spain was last out of the blocks.
*Other slowcoaches like Spain that can’t get house price data published quickly are Belgium, Bulgaria, Croatia, Cyprus, Czechia, Estonia, France, Greece, Hungary, Israel, Italy, Japan, Latvia, Luxembourg, Malaysia, Morocco, Poland, Romania, and Slovenia. All the rest were based on Q2 data.