House prices fall at one of sharpest levels worldwide

IRISH house prices fell by one of the sharpest levels worldwide in the last year.

A survey, which covers house price growth in 50 countries, placed Ireland in 48th position with an annual fall of 11.9% on the global scale.

Russian houses fell by as much as 13.7% in the same period while Malta was just above Ireland’s drop at 4.1%. Dubai house prices fell by 8.2% for the year.

The survey by Knight Frank said it would seem that the drop in Irish house prices is decreasing.

Globally house prices increased by 1.8% in the year to March, the lowest annual rate of growth recorded since quarter four 2009.

House prices in 25 of the 50 countries included in the index remained flat or saw negative growth in the first three months of 2011, compared to only 18 countries a year earlier.

In regional terms, Asia remains the top-performing continent, recording 8.4% growth over the last 12 months. However, this is down from 17.8% a year earlier. The weakest region was North America which saw a fall of 0.4% in values in the year to quarter one 2011.

While house prices in Europe were static in quarter one, this represents an improvement on 12 months earlier when house prices had fallen 4.1% in the preceding 12 months.

The strongest performing countries were Hong Kong (24.2%), where the government is fighting to pull inflationary pressures under control, India (21.9%) and Taiwan (14.3%).

Head of residential at Knight Frank, Liam Bailey said: “A cursory glance at the results table would suggest it’s business as normal, with Asian countries firmly implanted at the top of the table and both Europe and North America languishing behind. But there are a few less predictable results.”

France has jumped to sixth place in the rankings, up from 30th a year earlier while Sweden and Germany, by comparison, have experienced several quarters of positive growth only to fall back in quarter one 2011.

“In most of these cases, with the notable exception of Germany, the housing market is reflecting the wider economy’s performance as well as responding to domestic policy decisions,” said Mr Bailey.