Free exchange

Economics

Global house prices

Clicks and mortar

Nov 24th 2011, 12:35

Our interactive overview of global house prices and rents

SCARCELY has one bubble deflated when another threatens to pop. While America's housing bust—the crash that began the global financial crisis—is near an end, adjustments elsewhere are incomplete. In a few countries, like China and France, values look dangerously frothy. There is always trouble somewhere. And because buying a house usually involves taking on lots of debt, the bursting of this kind of bubble hits banks disproportionately hard. Research into financial crises in developed and emerging markets shows a consistent link between house-price cycles and banking busts.

The Economist has been publishing data on global house prices since 2002. The interactive tool above enables you to compare nominal and real house prices across 20 markets over time. And to get a sense of whether buying a property is becoming more or less affordable, you can also look at the changing relationships between house prices and rents, and between house prices and incomes.

Readers' comments

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lake forest homes for sale

Firstly let's look at how a median price is calculated. The median house price is essentially the sale price of the middle home in a list of sales where the sales are arranged in order from lowest to highest price. I don't think it's an accurate way to measure movements in house value.

lake forest homes for sale

jazzrefresh

Does nothing for me. I still cant afford to buy my first house. God knows about pension. Dont know where to put money to save. No matter where you invest the returns are swallowed by inflation. Salaries are so tight that it just lasts the month. Its just 96 hours to stone age.

Ed (Brazil)

dear "The Economist"

Grat chart, nice work.

Would you be able to do a chart on farmland prices ?

That's the next bubble you know ?

And given the size of the 2008 crisis, I think home prices have not fell enough to balance the market yet.

Silfverberg - Copenhagen

Thanks to The Economist for a most interesting tool. In Denmark and all other countries I know of we see huge regional differences in price development, where there are jobs house prices are more stable, where there are no jobs prices decline dramatically. The role of greedy financial institutions cannot be underestimated. Allthough it is hard at present to see interest rates coming up, they have always been cyclical. Demographics are probably also cyclical, but the waves are too long for my taste/age.

MRHass

Just as others have commented that as far as house prices go in the UK, there is London and then there is the rest of the country, a similar adage might be said to exist in Canada: there is Vancouver, and then there is the rest of the country.

happyfish18

When coming to property investment, some laowais had told me they would only buy in areas where there are a lot of Chinaman like Vancouver, Hong Kong, Singapore, Shanghai, San Francisco etc. to make a speculative killing.

Nirvana-bound

Buying real estate as an "investment", is fraught with all sorts of speculative risks especially in a bubble-prone housing markets. The US, Ireland, Spain, Japan etc are glaring examples of this financially devastating syndrome.

Even those who consider their principle home as a potential nest egg are in for a huge disappointment (if they decide to sell down the road), when they factor in the cummulative mortgage payments, accumulated interest charges, on-going inflation, constant repair & maintenance costs & never-ending what-have-you expenses.

The bottom line is real estate is a REAL RISK. Venture with extreme caution..

Alexworld

Millions of Australians would like to know where in Australia you can buy a house that is livable for less than US$700,000. The Australian Bureau of Statistics keeps releasing figures and statistics, on the Australian lifestyle and status, that definitely do not reflect in any way, the true living conditions and standards in Australia.

robribbit

the data on China and Canada does not seem representative of the current market conditions. There is no way China's housing prices are that low. and the data for Canada, unless taken as a whole, doesn't seem plausible.

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In this blog, our correspondents consider the fluctuations in the world economy and the policies intended to produce more booms than busts. Adam Smith argued that in a free exchange both parties benefit, and this blog's aim is to encourage a free exchange of views on economic matters.

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