US: record low mortgage rates and sparse supply
According to the US National Association of Realtors (NAR), mortgage rates have got stuck firmly at the lowest level since the beginning of such surveys. Mortgage rates have not climbed above 3% since July 2020. They have been trapped in the range of 2.65% - 2.77%. Buoyant demand for residential property, low mortgage rates which dropped from 4.5% to 2.8% in a year, and limited supply have sent house prices soaring. Referring to the web portal Realtor.com, Americans have to deal with steadily growing demand for homes. In this context, home supply contracted 43% in January 2021 in annual terms. The enormous demand in the housing market has been recorded in megalopolises on the Eastern and Western coasts as well as in smaller towns inside the country. For example, prices of homes in the state of Tennessee jumped 10%. The Federal Housing Finance Agency points out that home price inflation is the highest in the provinces.
UK: boom in housing market amid tax perks
Citing well-informed sources, The Guardian reported that residential property in the UK has appreciated 7.3% over the last year. This is the highest inflation in the housing market for the recent 6 years. In the second half of 2020, British realtors noted unprecedented demand for homes in the Kingdom. In fact, the UK authorities cancelled a tax on a home purchase valued less than £500,000. The term of the tax relief is March 31, 2021. This measure was introduced with a view to revitalizing the housing market in the wake of lockdowns. Since October 2020, realtors pointed out a downtrend in home sales. However, thanks to the tax perk, home sales ballooned 70% in December on a yearly basis. According to the web portal Rightmove, home sellers insist that buyers should finalize their home purchases until the tax relief term expires.
Spain: homes get cheaper in big cities
On the grounds of the data on the web portal Idealista, prices of residential property in Spain climbed 1.6% during the last year. A square meter cost €1,786 on average in January 2021 that was 0.4% up from December 2020. Experts predict a moderate inflation in the housing market throughout the whole 2021 in most regions of Spain. Madrid and Barcelona are the cities where residential property is traditionally the most expensive in the country. An average cost of a square meter of such property equals €3,700 in Madrid and €4,000 in Barcelona. There are other towns with costly home prices, including coastal resort San Sebastian (€5,000/m2), Bilbao (€3,100/m2), and Palma de Mallorca (€2,900/m2).
France: focus on homes in countryside
Referring to FNAIM, a large national real estate agency, 980,000 deals were completed in the French housing market last year. Apartment prices in France rose 6.6% and house prices grew 6.1% through the whole 2020. In March 2020, the number of home sales steeply fell as the coronavirus lockdown crippled activity of local businesses. Later in the year, the housing market revived. Home sales soared 460% in April – June 2020. In Paris, the capital city, apartment prices jumped 7.6% to $12,873 per square meter. Adjusting their needs for the pandemic, the French are now interested in buying more spacious homes in the countryside or in suburbs. According to the web portal Bien'ici, the number of buyers looking for land in the countryside for building a house increased 63% in 2020. Real estate in the Île-de-France region and in Burgundy’s district Yonne gained the most popularity.
Germany: enormous demand for apartments
International real estate broker Tranio confirms that the housing supply in Berlin has eventually got on the rise after many years of low demand. Remarkably, experts estimate that Germany’s capital city lacks almost 200,000 apartments. Nowadays, the construction sector in Germany has been expanding with some evident signs of progress. According to Destatis (the federal statistics agency), the number of permits for building residential property climbed 5.7% to 238,899 units in the first three quarters of 2020. The strong demand boosted inflation of both new homes and existing homes. According to Tranio, one square meter in housing starts in Berlin costs €6,800 on average whereas one square meter in the market of existing homes measures €5,000. An average apartment in Berlin is sold at €4,990 per square meter. An apartment of 120 m2 downtown in Berlin is offered for sale at €598,920.