A snapshot of house prices in five cities around the world and how they compare to Ireland

We are used to hearing about house prices in Ireland. It seems to be never far from the news agenda. The latest house prices in December, according to the Central Statistics Office (CSO), showed the price of residential properties increased by 2.3 per cent in the year to October, with prices outside Dublin up by 4.5 per cent.

Prices in Dublin, however, did show a small decrease – by 0.6 per cent. In Dublin, the highest median price for a house in the 12-month period was €630,000 in Dún Laoghaire-Rathdown. The most expensive Eircode area over the 12 months to October 2023 was A94 “Blackrock” with a median price of €730,000.

Dublin has “become simply unattainable for most first-time buyers”, said Ian Lawlor, managing director of property finance firm Lotus Investment Group.

Five Irish Times foreign correspondents looked at house prices in their city, simply to get a glimpse of what house prices are like there, and if there are similar problems to the ones in Ireland.

Brussels

The average house price in Brussels is €556,081 and the average apartment is €285,338, according to the real-estate barometer of Fednot, Belgium’s Federation of Notaries.

The average house price has fallen 4 per cent compared with last year, after years of strong growth since the financial crisis, as higher interest rates hit. Apartment prices have stabilised, according to the figures, growing 1 per cent compared with last year.

By some measures, Belgium has had an excess of housing in recent years, with central bank figures in 2021 showing the country had 600,000 more homes than households. This has been attributed to the popularity of buying additional homes as an investment, as well as irregularities in the data. However, housing rights groups warn there is nevertheless a shortage of affordable housing, particularly for students and people on low incomes.

According to the most recent Eurostat figures, 12.4 per cent of Belgians who live in cities suffer from “housing cost overburden” as they pay more than 40 per cent of their disposable income on housing costs, the highest level after Greece and Denmark. The average gross income in Belgium is €3,886 a month, according to statistics office Statbel. – Naomi O’Leary

Beijing

The average price of new homes in Beijing in October was RMB55,847 (€7,097) per square metre, according to the Zhuge Data Research Centre. So, a two-bedroom apartment, which is typically 100sq m, cost an average of €709,700.

China has a home ownership rate of 90 per cent, compared with 70 per cent in Ireland. Although a downturn in the property market has seen a tightening of supply, prices for new homes have been falling.

Prices for second-hand homes have been rising and they are more expensive than new apartments or houses. So, the average, second-hand 100sq m apartment in Beijing would have cost the equivalent of €826,742 in October, according to the Zhuge Data Research Centre.

First-time buyers must make a down payment of 35 per cent of the sale price, so the maximum mortgage is 65 per cent. For a second home, the minimum down payment goes up to 70 per cent.

In an attempt to boost the housing market earlier this year, the Chinese government mandated lower mortgage rates for first-time buyers. They also introduced tax rebates for people who sell their home and buy a new, more expensive one in the same city. Some of China’s biggest property developers are deeply in debt and on the verge of bankruptcy as prices and sales of new homes have slumped. – Denis Staunton

London

Buying a home in London is a pipe dream for many households in the city. London house prices may be falling because of lofty interest rates, but affordability remains a huge problem. Slowing investment in new house construction means the situation is also unlikely to improve any time soon.

According to the Halifax House Price Index, the average property sold in London cost about £535,000 (€614,000) over the last year, more than 10 times average full-time earnings in the capital.

Affordability varies wildly by borough. The average price/earnings ratio in Barking and Dagenham on the northeastern fringe of London is 5.4 times, but it is 15.7 times in Kensington and Chelsea where the average property price is £1.4 million. The average flat costs about a third less than a house.

Official data from the UK’s land registry suggests house prices in London fell 1.4 per cent in the year to the end of August. This broadly tallies with data from property sites such as Zoopla, which measures asking prices. Halifax, which uses mortgage data, estimates the drop at up to 4.8 per cent.

The recent fall in prices is largely down to escalating mortgage interest rates, which are higher in the UK than almost anywhere else in Europe.

Limited supply is preventing house prices from falling more quickly. The pace of new housing construction is at its lowest in London in a decade, once the impact of the pandemic is stripped out. High borrowing rates have hit builders as well as buyers. The Bank of England forecasts that investment in new housing in London will fall 6 per cent next year, on top of a similar dip in 2023.

Whatever happens elsewhere in the market, the top end of London’s property scene always chugs along regardless. According to data from Savills, 390 properties were sold for more than £5 million each in London in the first nine months of 2023, many of them in cash deals with foreign buyers. This is two-thirds higher than before the pandemic. About 120 deals were sold for more than £10 million each. – Mark Paul

The median house price in the Washington region was $590,000 (€540,000) as of last July

Washington, DC

House prices in the Washington region are climbing in some areas, but falling in others. About 700,000 people live in the District of Columbia itself, but the broader region spreads outwards into parts of the neighbouring states of Virginia and Maryland.

For house prices, the median for all types in the region was $590,000 (€540,000) as of last July, up 4.8 per cent from the same month last year. However, house prices vary significantly depending on location. Northwestern Washington tends to be the most expensive area, with median prices in more salubrious neighbourhoods such as Georgetown being reported at more than $2 million.

In the District of Columbia the median price in July was $625,000 (€572,000) for all kinds of housing. This was down about 3.3 per cent, according to data from the association of realtors in the city.

However, there were some significant increases in prices reported in a number of suburbs of Washington. In Frederick County in Maryland, on the northern outskirts of the DC area, median prices increased by 7.8 per cent over the last year to $485,000 (€444,000). The median price in Fairfax City in Virginia increased by about 9 per cent to $730,000 (€668,000).

In a statement in August, the president of the Greater Capital Area Association of Realtors, Avi Adler, said: “We’re experiencing a somewhat dysfunctional housing market at the moment. Lack of housing inventory presents challenges for buyers and potential sellers. There are fewer buyers due to higher interest rates and even fewer sellers, who feel handcuffed to their existing home and low mortgage rate. As a result, sale prices are holding strong and multiple offers are not uncommon.” – Martin Wall

Berlin

The German capital has come a long way since unification in 1990, from a buyer/tenants’ market to, by many popular surveys, the country’s second-most expensive property market after Munich.

German housing prices – both rents and purchase prices – are generally discussed and calculated as a multiple of a per square metre price. In 2022, official figures show the average apartment price was €5,542 per square metre and €5,943 per square metre for a house, meaning a 100sq m apartment and house cost, on average, €554,200 and €594,300. Overall, property prices have fallen 1.5 per cent compared with this time last year, though prices have risen slightly in four of the most desirable areas.

Average apartment property prices have jumped by 104 per cent in the last decade. Driving the price surge: a population surge and shortage of supply.

After a slack property market in the late 1990s and early 2000s, due to an economic slump and net population drop, prices began rising in 2005 – and have risen exponentially in the last decade as new companies – in particular international and domestic tech and ecommerce companies – attract international staff to the city.

As a result, Berlin’s population has jumped 11 per cent in a decade to 3.76 million; its foreign-national population has doubled in the same time to 24 per cent of the total. That surge has not been matched by new building: though the city estimates it needs about 120,000 new units annually, just over 15,000 permits were issued in 2022 – down for the sixth year in succession.

Construction companies blame high land prices and rising bureaucracy, making it unattractive to build. Less than 1 per cent of the capital’s housing stock is vacant, according to official figures. – Derek Scally

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