ResidentialTaryn ParisMon 14 Mar 22

Australia’s House Price Growth Tops Global Market

Australia’s residential market has chalked up the biggest price growth in the world with a further 8 per cent tipped to the end of this year.

Knight Frank research shows Australian property increased an average of 17.5 per cent in real terms, which is adjusted for inflation.

Globally house prices grew 10.3 per cent on average in 2021, but Knight Frank is forecasting a more muted growth rate for 2022.

Knight Frank Australia head of residential research Michelle Ciesielski said Australia’s residential property market was a stable “safe haven”.

“[This] is one of the reasons why Australia has seen significant growth in values over the past year,” Ciesielski said.

But the next 12 months are not going to be as rosy, according to Ciesielski.

“We’ve now reached a point where the Australian housing market has become fatigued after riding significant growth in values on the back of an economic rebound, and is now grappling again with global uncertainty, a natural disaster and an upcoming federal election,” she said.

“We can’t ignore the fact that we are facing a rental crisis in our cities and regional areas of Australia, with delayed construction in what has already been a diminishing pipeline of newly built homes.

“[Also] a lower number of local and international investors adding to the rental pool, and a likely increase in the skilled migrant population who also increase the demand for rental properties.”

Ciesielski said despite the economic headwinds the imbalance between demand and supply of residential stock in Australia will boost price growth in 2022 of up to 8 per cent by the end of the year.

The top five performers globally for both nominal and real term price growth were Turkey, New Zealand, Czech Republic, Slovakia and Australia.

Just three markets chalked up a decline in 2021, these were Malaysia, Malta and Morocco.

Knight Frank research shows the top 10 markets for house price growth since the start of the pandemic in 2020 were predominantly developed markets where governments stepped in to stimulate the economy, and support housing markets through “mortgage holidays” or subsidies.

Global house price index: Q4-21

Rank	Country	Nominal price growth	Real price growth
1	Turkey	59.6%	17.3%
2	New Zealand	22.6%	15.7%
3	Czech Republic	22.1%	16.4%
4	Slovakia	22.1%	15.4%
5	Australia	21.8%	17.5%
6	Netherlands	20.3%	13.8%
7	United States	18.8%	11%
8	South Korea	18.4%	14.2%
9	Jersey	18.4%	14.1%
10	Estonia	17.3%	10%
11	Sweden	16%	11.7%
12	Iceland	15.9%	10.2%
13	Canada	15.5%	10.1%
14	Russia	14.6%	6.7%
15	Ireland	14.4%	8.4%
16	Ukraine	13.6%	3.3%
17	Luxembourg	13.4%	10.4%
18	Slovenia	12.9%	10.2%
19	Latvia	12.7%	7.6%
20	Austria	12.6%	8%
21	Hungary	12.6%	6.7%
22	Germany	12.4%	6.8%
23	Chile	11.7%	6.1%
24	Portugal	11.2%	8.2%
25	United Kingdom	10.8%	5.1%
26	Israel	10.1%	7.4%
27	Singapore	9.8%	5.7%
28	Lithuania	9.4%	-1%
29	Japan	9.2%	9%
30	Croatia	9%	5.6%
31	Poland	8.9%	2.8%
32	Bulgaria	8.7%	3.7%
33	Mexico	8.6%	1.1%
34	Belgium	8.2%	5.2%
35	Norway	8.1%	2.6%
36	Greece	8%	5.6%
37	Denmark	7.6%	4.3%
38	France	7.1%	4.2%
39	Peru	7%	0%
40	Columbia	6.8%	1.1%
41	Romania	6.3%	4%
42	Brazil	5.3%	-4.3%
43	Switzerland	5.2%	3.6%
44	Spain	4.4%	-2%
45	Italy	4.2%	1.6%
46	Taiwan	3.6%	1.6%
47	Finland	3.8%	0.3%
48	Chinese mainland	3.6%	2.3%
49	Hong Kong SAR	3.6%	1.2%
50	South Africa	3.5%	-2.3%
51	India	2.1%	-3.4%
52	Indonesia	1.5%	-0.4%
53	Cyprus	1.2%	-2.8%
54	Malaysia	-0.7%	-2.8%
55	Malta	-3.1%	1.4%
56	Morocco	-6.3%	-7.4%