House prices around the world are under pressure as central banks raise benchmark interest rates to try to curb inflation. But the truth is that house prices in 56 countries are rising at the slowest rate since 2015, as there is less pressure from demand on existing housing supply. Even so, Portugal was ninth on the list of house price increase: prices grew by 11.4 percent in the last year ending March 2023.
Average annual house price growth in the 56 markets covered by the Knight Frank Global House Price Index slowed to 3.6 percent in the 12 months to the end of the first quarter of 2023. In the previous quarter, the increase in house prices was 5.7 percent.
Looking at the time horizon, house prices are rising at the "slowest annual rate" since the third quarter of 2015," they concluded in a statement sent to the press. The rise in global house prices has thus fallen from the recent peak of 11.1 percent recorded in the first quarter of 2022 (last 12 months), when global markets were booming in the aftermath of the pandemic.
Analysing the data for the last year ending in the first quarter of 2023, it can be seen that house prices have risen in most countries (in 39 of the 56 analysed). In first place is Turkey, where prices have risen by 132.8%, the result of "galloping inflation", the document analyses. North Macedonia (18.8 percent) and Croatia (17.3 percent) are in the top three of the highest house price rises.
Portugal appears in the top 10 of the index of markets whose prices have grown the most in the last year (11.4 percent). In the other southern European countries, house prices rose at a much slower rate: Spain (3.1 percent) and Italy (1.1 percent).
What also stands out is that house prices fell in 17 countries around the world, eight of which contracted by more than 5 percent, with South Korea (-15.7 percent), New Zealand (-13 percent), Hong Kong (-10.3 percent) and Sweden (-8.8 percent) leading the declines.
Evolution of house prices around the world
| Ranking | Countries | 12 months variation (%) |
|---|---|---|
| 1 | Turkey | 132,8% |
| 2 | North Macedonia | 18,8% |
| 3 | Croatia | 17,3% |
| 4 | Hungary | 16,6% |
| 5 | Lithuania | 15,3% |
| 6 | Greece | 14,5% |
| 7 | Iceland | 13,4% |
| 8 | Mexico | 11,7% |
| 9 | Portugal | 11,4% |
| 10 | Singapore | 11,3% |
| 11 | Malta | 10,5% |
| 12 | Israel | 9,8% |
| 13 | Bulgaria | 9,5% |
| 14 | Colombia | 9,4% |
| 15 | Poland | 9,3% |
| 16 | Estonia | 9,2% |
| 17 | Slovenia | 8,8% |
| 18 | Cyprus | 8,5% |
| 19 | Romania | 6,8% |
| 20 | Japan | 6,8% |
House price developments in 2023 slow down even more
It's 2023 and the trends are getting worse. Interest rates on home loans are getting higher and higher, making it more difficult for families to buy a home. Not least because purchasing power continues to be pressurised by high inflation in several countries. As a result, global house prices fell to 1.5 per cent in the first three months of the year (although this is better than in the last three months of 2022, when they contracted by 0.6 percent).
If we analyse the three-month variation up to the first quarter of 2023, the market with the highest growth is Turkey (22.2%), followed by Lithuania (8.2%) and Malta (7.3%). House prices in Portugal are also showing signs of slowing down, with growth of 1.7 percent in the last quarter and 3.8 percent in the last six months.
But more house price falls were recorded in the first months of 2023, with housing becoming cheaper in 23 of the markets analysed. The countries where house prices fell the most in the same period were Sweden (-4.5 percent), New Zealand (-4.1 percent) and Slovakia (-3.9 percent), the data shows.
House prices to buy around the world: how have they evolved in 2023?
| Ranking | Countries | 3 months varation (%) | 6 months variation (%) |
|---|---|---|---|
| 1 | Turkey | 22,2% | 40,8% |
| 2 | Lithuania | 8,2% | 13,5% |
| 3 | Malta | 7,3% | 7,6% |
| 4 | Croatia | 4,7% | 7,7% |
| 5 | Greece | 4,0% | 6,2% |
| 6 | Japan | 3,9% | 4,0% |
| 7 | Mexico | 3,2% | 5,6% |
| 8 | Colombia | 3,0% | 4,8% |
| 9 | Singapore | 2,6% | 2,9% |
| 10 | Romania | 2,5% | 1,3% |
| 11 | Spain | 2,2% | 2,8% |
| 12 | Norway | 1,9% | −2,2% |
| 13 | Portugal | 1,7% | 3,8% |
| 14 | Bulgaria | 1,6% | 2,0% |
| 15 | Slovenia | 1,6% | 3,0% |
| 16 | Belgium | 1,5% | 1,1% |
| 17 | Cyprus | 1,4% | 2,7% |
| 18 | Hong Kong SAR | 1,4% | −6,1% |
| 19 | South Korea | 1,4% | −8,5% |
| 20 | North Macedonia | 1,3% | 6,1% |
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