Global real estate markets are showing tentative but growing signs of stabilization, according to the Global Real Estate Trends report released today by Scotia Economics.
“Real home prices increased in a number of major developed economies in the second quarter of 2009, including Canada, Australia and the United States,” said Adrienne Warren, Senior Economist, Scotia Economics. “Prices were still falling in many other markets, including the U.K., France and Spain, but generally at a slowing rate. For the most part, however, real home prices are still lower relative to a year ago.”
Scotia Economics believes the improving sentiment in global residential real estate markets is sustainable. According to the report, the firming in pricing is evidence of growing confidence in the sustainability of the fledgling global economic recovery. Historically low borrowing costs, increased affordability, and home-buyer tax incentives in a number of countries are underpinning a modest revival in housing demand. Indeed, signs of a bottoming in home prices are likely now bringing some fence-sitters off the sidelines.
“Financial market conditions, including rebounding global equity markets and an easing in credit constraints, are also becoming more supportive,” stated Ms. Warren. “A significant amount of worldwide excess production capacity will keep a lid on inflationary pressures for some time to come, allowing monetary authorities to keep short-term interest rates at historically low levels and very supportive of housing market activity.
Read the full release “A Global Housing Recovery Is Underway” at Newswire (Oct. 1 2009).