GLOBALISATION has created a handful of metropolises that attract people, capital and ideas from all over the world, almost irrespective of how their national economy is doing. House prices in such places, unsurprisingly, outpace the national average. In our latest round-up of global housing, we find that prices have risen in 20 of the 26 countries we track over the past year, at an (unweighted) average pace of 5.1% after adjusting for inflation. Prices in pre-eminent cities in these countries, however, have risen by 8.3% on average.
In a survey conducted last year, fewer than one in nine residents of Amsterdam, Berlin, London, Paris, Stockholm and Zurich thought that it was easy to find reasonably-priced housing. In these cities, house prices have risen at an average pace of 6.5% a year over the past three years (again, unweighted), compared with a national average rise of just 3.2%. The value of homes in four cities on the Pacific—San Francisco, Vancouver, Sydney and Shanghai—has increased by 12% a year over the past three years, twice the average national pace.
The supply of housing is rather inelastic, so in the short term...Continue reading
Source: Business and finance http://ift.tt/1MW6Lcz
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