The year 2016 saw many changes in the global real estate market, including some definite surprises. The Global Residential Cities Index showed that house prices worldwide rose 4.4%.

Shenzhen showed the biggest real estate boom worldwide in 2016. The city sits on the border of Hong Kong and has become an important centre for the manufacturing of technology components. Shenzhen has 10 million full-time residents and about 5 million part-time residents. When Shenzhen was chosen as China’s first special economic zone in 1979, workers swamped the area and housing was built to accommodate them.

The Impact of BREXIT

Instability in the global markets since the Brexit referendum has affected all markets to some extent.

Brexit sent economic shockwaves through global markets and Britain lost its top AAA credit rating.

After the result was declared, the pound fell to its lowest level since 1985 and David Cameron quit his job as Prime Minister.

There is continued nervousness over what will happen next because the EU countries now have to make alternate trade agreements with the rest of the world.

Brexit supporters maintain that the market fluctuations are temporary and that it will be in the best interest of EU countries to continue trade associations with the UK because it is one of the biggest importers of goods and services. But opponents are concerned that foreign companies will be less likely to invest and may move to other areas.

Falling in behind Shenzhen, Auckland was the next high-growth market, with an increase of 25.4%, followed by Istanbul (25%) and Sydney (19.9%).

Other outperforming cities include Hong Kong, Kuala Lumpur, Auckland and Sydney.

On the bottom rung was the Indian city of Chandigarh, the capital of the north Indian states of Punjab and Haryana. The market declined by 7.7% in 2016. Prices in Chandigarh continue to falter, primarily due to interest rate cuts by major financial institutions.

Notable Changes

Many cities that customarily experience high prices failed to feature prominently. London ranked at 11.4% growth with New York at (3.3%).

The Instability of the global markets since the Brexit referendum has affected all markets to some extent.

Brexit sent economic waves through global markets and Britain lost its top AAA credit rating.

After the result was declared, the pound fell to its lowest level since 1985 and David Cameron quit his job as Prime Minister.

There is continued nervousness over what will happen next because the EU countries now have to make alternate trade agreements with the rest of the world.

Brexit supporters maintain that the market fluctuations are temporary and that it will be in the best interest of EU countries to continue trade associations with the UK because it is one of the biggest importers of goods and services. But opponents are concerned that foreign companies will be less likely to invest and may move to other areas.

Experts agree that “Future domestic demand will be linked to the direction of interest rates, changes in mortgage rules and employment growth whilst currency shifts will be the key determinant of cross-border investment.” The fundamentals of supply, demand and rental growth will become key determinants of success.

In summary, Shenzhen showed the biggest real estate boom worldwide in 2016. Auckland was the next high-growth market, with an increase of 25.4%, followed by Istanbul (25%) and Sydney (19.9%)

The area with the weakest showing was Chandigarh. The market in Chandigarh.declined by 7.7% in 2016. Many cities that customarily experience high prices failed to feature prominently. London ranked at 11.4% growth with New York at (3.3%).

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