Barclays | Global Themes: Housing Market Outlook
27 June 2012 2
CONTENTS
OVERVIEW 3
US HOUSING MARKETS 7
EURO AREA HOUSING MARKET 19
UK HOUSING MARKET 31
JAPAN HOUSING MARKET 38
CHINA: REAL ESTATE 41
AUSTRALIAN HOUSING MARKET 44
Barclays | Global Themes: Housing Market Outlook
27 June 2012 3
OVERVIEW
A mixed outlook1
The outlook for global house prices varies significantly by country.
In this publication we focus on housing market trends, both for activity and prices, across
much of the global economy. What emerges is a decidedly mixed, though generally weak,
outlook. It becomes increasingly clear, as we move towards the sixth year of the financial
crisis, that for countries which experienced a combination of sharp increases in real house
prices during the period 1995-2008, followed by a substantial excess of supply, house
prices have been under significant downward pressure and in some cases (notably Ireland
and Spain) have not yet reached a final equilibrium.
That said, for markets which have adjusted more sharply in activity and price terms (such as
the US), there are indications of some recovery. Germany and Japan stand out for having
minimal growth in nominal house prices over the past 15 years, although there are some
indications that the former market is starting to recover, helped by a combination of
particularly low mortgage rates and yields for other forms of investment, low
unemployment and stronger real income growth. The UK market continues to look
expensive in relation to income levels, but is also supported by a shortage of housing stock
and – as with most countries – low debt servicing costs.
Figure 1 shows the dramatic rise and fall in house prices in markets which experienced
particular overheating – namely, the US, Spain and Ireland. These three markets share
common characteristics, in terms of having had a sharp run-up of prices in relation to
incomes, in part the result of declines in borrowing costs, which then resulted in a major
excess of housing supply.
Figure 1: House price trends (Q1 97 = 100)
(a) Nominal house prices(b) Real house prices。。。