Home prices in Malta surged 16.9% versus the SAR's 15.9%.
Malta has surpassed Hong Kong for the first time in the global home price rankings after residential property prices in the Mediterranean island surged 16.9% YoY in Q2 compared to the SAR’s 15.9%, according to Knight Frank Global House Price Index.
On a six-month basis, however, Hong Kong would have occupied the top spot after home prices rose 10.4% from Q4 2017 to Q2 2018.
Hong Kong’s heated housing market, which has occupied the top spot in the rankings on ten occasions since 2009, is showing signs of slowing down as a result of rising interest rates and government intervention, observed Knight Frank.
“Along with Singapore and New Zealand, Hong Kong has also seen new property market regulations introduced in the last three months,” the report’s authors said.
In tandem with the US Federal Reserve's tightening, major banks like HSBC, Bank of China (Hong Kong), Hang Seng Bank, Citibank, Standard Chartered and China Construction Bank have hiked mortgage rates across the board, a move signalling the end of the city's ultra -ow interest rate environment.
This adds to the growing chorus expecting an imminent slowdown in the overheated property market with Nomura International expecting residential property prices to crash 13% in 2019 - effectively wiping out most of the price gains recorded this year.
Also read: Housing correction of 15% possible in 2019
“Remember what happened in late 2015 -- prices dropped about 13 percent in only six months, and the trigger was the Fed’s rate hike,” Joyce Kwock, head of Hong Kong property research at Nomura International (HK) Ltd. said in a briefing in Shanghai on Tuesday. “The entirely same situation may repeat again.”
As Hong Kong’s property market loses its luster, home prices in Central and Eastern European countries are set to pounce after Latvia, Slovenia and Hungary booked double-digit growth pushing to the top five. Close regional competitor Singapore was the only other Asian country in the top ten after it nabbed ninth place.
Established in 2006, the Knight Frank Global House Price Index compares the performance of mainstream residential markets across the world using government statistics or central bank data.
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