Even in far more stable housing markets across the region, the recovery is faltering or was snuffed out some time ago. In Australia, prices fell in three of the eight capital cities last month, including Melbourne, and are starting to resume their decline in Sydney.
In Hong Kong, they were never potent in the first place. Having recovered briefly in the first quarter of this year, the Centa-City Leading Index – a gauge of second-hand house prices – has dropped more than 10 per cent since early April, taking its decline since the August 2021 peak to about 21 per cent.
Why Singapore’s residential property market is not about to hit the skids
Why Singapore’s residential property market is not about to hit the skids
An end to negative rates in itself would not necessarily cause mortgage rates to rise. But if rates turn positive, this would push up short-term prime lending rates, putting upwards pressure on floating-rate mortgages that account for roughly 70 per cent of Japanese housing loans.
Housing markets in the Asia-Pacific region are a mixed bag. Many have proved more resilient than anticipated, yet signs of renewed slowdowns and deeper downturns are evident. For Japan, the pain may still be to come.
Nicholas Spiro is a partner at Lauressa Advisory