Experts expect real estate prices worldwide to rise sharply in the coming years. This is according to the latest survey of economic experts (EES), which is conducted every quarter by the ifo institute and the Swiss Institute for Economic Policy. According to the study, real estate prices will increase by an average of 9 percent per year over the next ten years. Experts forecast an increase of 8.4% in the UK, 6.0% in the US and 5.5% in France. “The increase in real estate prices is driven more by demand than supply factors,” says ifo researcher Timo Wohner.
In many regions of the world, increased demand in the real estate market is due to higher living standards and incomes, as well as population growth and the desire for more living space. A total of 37 percent of respondents cited these factors as the reason for the sharp increase in prices.
The tendency to work more from home also plays a role. “According to 27 percent of the experts, supply factors such as limited production capacity, higher prices of construction materials and lack of building plots are responsible for the rise in real estate prices,” says Wohner. Monetary policy, inflation and government policy are cited by 12 percent of respondents as drivers of the increase in real estate prices.
In Western Europe (6.4 percent) and in North America (7.7 percent), the increase in real estate prices is expected to be below the world average. Significantly higher growth rates are expected in Southern Europe (18.4%) and Eastern Europe (14.9%). The increase in real estate prices is expected to be particularly high in South Asia (25.1 percent), West Asia (22.4 percent) and Central America (24.4 percent). The figures provided are nominal growth rates, writes Pariteni.bg.
At the regional level, experts’ expectations for real estate prices correlate strongly with their inflation forecasts. “Actual growth rates will be lower,” says ifo researcher Philip Hile. “In the UK, house prices have risen by more than 67 per cent over the past ten years and this trend is likely to continue.” That figure is 112 percent in the US and 25 percent in France.
A total of 1,405 economic experts from 133 countries participated in the survey, which was conducted from June 14 to July 2, 2023.
2023-08-06 05:54:10
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