While there is much focus upon the US, the UK and the European real estate market the Global Property Guide gives a very interesting snapshot of annual returns to the end of the second quarter of 2015. Even though there is some concern regarding the worldwide real estate market it seems that some areas are certainly doing better than others. Perhaps the doom and gloom portrayed by the financial press does not give an accurate impression of the overall sector?
Hong Kong hits top spot
When you bear in mind the ongoing problems surrounding China it may surprise many people to learn that Hong Kong delivered the best return in real estate to the year ended June 2015. A return of 20.14% is at the other end of the spectrum compared to the overall Chinese real estate market and perhaps highlights why Hong Kong was for many years a stand-alone colony.
Ireland
The Irish real estate market increased by 10.7% over the period in question although when you bear in mind the monumental collapse in the aftermath of the 2008 mortgage crisis this is perhaps small compensation for those who suffered. However, it does show that the Irish real estate market is back on track, attracting buyers and the massive overhang of unwanted properties seems to have been cleared?
Estonia
While perhaps not top of the agenda for the vast majority of real estate investors the Estonian property market delivered a return of 8.99%. This was the second-best performing European market, behind Ireland, although there are signs that the rate of growth is slowing. On a positive note, it does show that not all of the European real estate market is surrounded by doom and gloom.
Philippines
Again, despite the economic challenges in the Far East the Philippine property market has held up remarkably well, with prices rising by 7.26%. Indeed there has been a significant increase in the rate of growth compared to the previous 12 months. Perhaps the greatest challenge to this particular area of the world is the failing Chinese economy and the controversy surrounding the troubled real estate market.
Iceland
Icelandic property prices increased by 7.84% but it is well documented that the market collapsed in the aftermath of the financial crisis of 2008. It is good to see the market recovering, encouraging to see property investors returning but will we see further property price growth in light of the difficult worldwide economic backdrop?
This covers the top five best performing real estate markets in the year to the end of June 2015 with countries such as Norway (6.62%), Japan (6.54%), Mexico (6.38%), New Zealand (5.39%) and the US (5.36%) making up the top 10.
Conclusion
The top 10 best performing real estate markets in the Global Property Guide offer a mixture of organic growth and recovery from potentially oversold positions. There are some surprising names in the top 10 although it will certainly be challenging to repeat that performance in the short to medium term. All eyes appear to be on the Chinese economy with some experts predicting a knock-on effect to the US economy which will obviously impact the worldwide economic situation.
However, real estate markets have surprised before and there is no reason to think they won’t surprise again!