Knight Frank reports global fall in house prices

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by Gill Montia

Upmarket property consultancy, Knight Frank, has published its latest global house price index which asserts that over the three months to the end of September, global house prices have fallen for the first time on record.

The average decline in the cost of a home stood at 0.3% on the previous three months but in Latvia prices dipped by 6.2%.

In the UK the quarterly fall stood at 4.6%; Norway 4.5%; and Canada 4.9%.

The firm’s head of international research, Nicholas Barnes, believes that no part of the world is likely to escape the credit crunch in terms of property price falls and is predicting that the majority of locations will show zero or negative growth by the end of 2008.

Countries already showing an annual decline include the UK at -10.6%; Estonia -16%; the US -16.3% and Latvia -24.1%.

Despite the third-quarter downturn, average global house prices are still showing annual growth at 3.8%, with the countries registering the strongest growth in the 12 months to the end of September including Dubai +76.1%; Slovakia +31.2%; Russia +26.9% and Bulgaria +26.8%.

However, all four countries saw growth slow during the third quarter of 2008, compared with the previous three months.

Knight Frank’s research is based on official national statistics gathered from 44 nations.