High-end apartments fuel property price increases
Property prices in the first three months of this year rose by 5.5% on a year earlier, the Central Bank has found, on the basis of its survey of advertised prices.
Prices also rose by 6.1% in the previous quarter.
The increase in the overall property price index over its year-ago level was primarily a result of developments in the market for apartments, the bank said.
Apartments saw an annual increase of 8.7%. The main reason behind this
relatively strong growth was the increased number of advertised upmarket properties in high value areas compared with previous years.
During the first quarter of 2012, asking prices in the “other” category, which
consists of townhouses, houses of character and villas rose by 4.1%. This increase was largely a result of higher asking prices for houses of character.
Prices of villas and townhouses also increased; however, their impact on the headline rate was more contained.
On the other hand, asking prices for maisonettes were marginally down over their year-ago level while prices for terraced houses dropped at an annual rate of 8.5%.
With regard to the latter, given the small number of terraced houses in the Bank’s sample, this development had a limited downward impact on the overall property price index.
The bank said the number of advertised properties captured in the Bank’s survey contracted by 3.1% on a year earlier in the first quarter of 2012, compared with a 7.0% decline in the previous quarter.
Meanwhile, the number of building permits issued by Mepa also continued to decrease, going down by 16.5% year-on-year in the March quarter, following a drop
of 17.6% in the previous quarter.
In absolute terms, this was mostly due to a lower number of permits issued for
apartments although development permits for maisonettes and the “other category” also registered drops. In contrast, development permits for terraced houses increased.
Residential property prices based on the NSO Property Price Index, which had fallen by 1.4% in 2011, rose by 1.6% year-on-year in the March quarter of 2012. The
increase in the latter reflected a 1.7% rise in the prices of apartments and a 6.0% rise in those of maisonettes. On the other hand, NSO data also show that, after they had risen by 7.0% during 2011, the number of sale contracts dropped at an annual rate of 6.7% in the first quarter of 2012.