Global house price fall underway won’t do much for affordability, say analysts – Reuters

BENGALURU, Dec 15 (Reuters) – House prices in most major property markets will fall in 2023, according to nearly 100 housing market analysts polled by Reuters, but they predicted double-digit peak-to-trough declines will not come close to making them affordable.

Mortgage rates have doubled on average in developed economies since the start of the year as their central banks fight runaway inflation with higher interest rates. With a few more hikes still expected to come, that trend was unlikely to reverse in the short-to-medium term.

House prices in the United States, Canada, Britain, Germany, Australia, and New Zealand rose between 25% and more than 50% since the outbreak of the coronavirus pandemic in early 2020.

That rally, lit by rock-bottom rates and a scramble by millions who shifted to work from home to find more living space, pushed properties further out of reach for many first-time homebuyers.

While most markets are now retreating from highs, there appears to be very little solace for those still dreaming about their own homes.

Among the nine housing markets surveyed, prices in six were expected to drop next year. Only China’s beleaguered property market, alongside outliers India and Dubai, were forecast to rise, according to latest Reuters polls.

Reuters Graphics

But while house prices in developed economies are expected to fall between 10% and 18% from peak-to-trough, led by New Zealand, those predicted declines would amount to just about one-third of the

The original article can be found here