Spanish Property Sector: Real estate stocks were down in Spain last month and it has affected property markets worldwide. Some believe that Spain's decade old construction boom is finally over. There are some obvious spots that will face the reality soon..
UK's housing market is so far unaffected, but there are signs that higher interest rates and stretched affordability are starting to dent. Recent reports suggest prices being rising at a slower pace. Average price of a home rose by 2.8% in the first 3 months of 2007 compared to 4.2% in the previous quarter, as per Halifax - the mortgage lenders.
US housing slowdown has been dramatic. The writing is on the wall as buyers could no longer afford to buy using traditional financing options. Asurge in arrears, defaults and meltdown in the sub-prime mortgage market - are all signs of things to come. Economists are warning about excess supply caused by a flood of repossessed properties can translate into in house prices.
Dubai, UAE: An estimated 15 to 25% of the world's construction cranes are in Dubai, symbolic of a market in such a hurry to build and oversupply can become a real issue.
Developments are being built at a fraction of the price for a similar property in Europe, and investors who purchased a couple of years ago have already seen their capital grow. In the longer-term, however, it is hard to know if this is sustainable popularity or merely a boom-time feeding frenzy.
Latvia: Knight Frank's recent global house price index is Latvia. Property prices have risen 66% in the past year thanks to a red-hot economy fuelled by booming consumption and easy credit. Since a part of European Union in 2004, Latvia's real estate market is a magnet for investors from Europe.
But there is a growing feeling that the market is an accident waiting to happen. In an attempt to prevent the bubble bursting, the government last month pushed plans to cool down. Measures include taxing profits from the sale of real estate in the first 3 years of ownership, an extension from the current one year rule.
Australia Property Market: Australian real estate prices were doubling between 1996 and 2003. A flurry of interest rate rises took the wind of the market's sails, but the slowdown was remarkably modest by historical standards.
Since then, the market has shown clear signs of strengthening again, clocking up 8.3% growth last year against 2.3% in 2005. Indeed, the recovery has been such that affordability is now considered the worst on record.
Property Market of India: US tycoon Samuel Zell told a gathering of Indian Real Estate Executives last month that it was "mental masturbation" to believe there were endless riches for investors in India's housing market. Coming from a man nicknamed "the grave dancer", the warning was perhaps not that unexpected. For the developers and fund managers who were listening, however, the only question remaining was how far property prices will fall.
Mumbai has become Indian Property Boom's epicenter. Prime residential prices have doubled in just two years. More people are buying homes and real estate is also attracting speculative investors, many of them from abroad. But when half the population is till living in slums, there is a growing feeling that the market is on the brink of a collapse.
The last time a property bubble burst in India - between 1995 and 2001 - prices slumped by up to 70%. This time, a fall of 30 to 40% is on the cards. Investors know what to do!
Source: The Independent, UK
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