In the post-financial crisis years, global cities like London, Hong Kong and New York appeared to defy housing-market cycles, thanks to a concentration of financial jobs and the self-fulfilling belief that they offered investors a safe haven. However, now it seems the majority of data releases appear to turn those assumptions upside-down.
This same slowdown seems to be happening in many major cities around the world, and the causes are often very similar: Rising interest rates, new regulations and a volatile stock market.
In Manhattan, the median condo price dipped below $1 million for the first time in three years. Hong Kong home values endured their longest losing streak since 2008, while prices in outer London neighbourhood sell for the first time since 2011. Sydney homeowners are grappling with the worst real estate slump since the 1980s.
International investors in search of higher-yielding investments have poured cash into the biggest, most expensive housing markets, pushing prices ever upward. Governments became concerned the gains were unsustainable and reacted with measures aimed at curbing the flows of international money.
The number of home sales in Vancouver dropped 32% in 2018 from the previous year, following a series of new taxes, stricter mortgage rules and rising interest rates. Median prices in Auckland registered their first annual drop since 2008 after the New Zealand government passed legislation to restrict foreign buying that it said was partly to blame for escalating housing costs. Home prices have dropped 11% in Sydney from their 2017 peak after government restrictions on foreign purchases and tighter credit.
Source Credit: Bloomberg Pursuits
The post Global Cities Are No Longer Resistant to Global Housing Downturn appeared first on Penthouse Queen.