Portugal, Canada, and the United States were the countries with the highest house price to income ratio in 2024. In all three countries, the index exceeded 130 index points, while the average for all OECD countries stood at 116.2 index points. The index measures the development of housing affordability and is calculated by dividing nominal house price by nominal disposable income per head, with 2015 set as a base year when the index amounted to 100. An index value of 120, for example, would mean that house price growth has outpaced income growth by 20 percent since 2015. How have house prices worldwide changed since the COVID-19 pandemic? House prices started to rise gradually after the global financial crisis (2007–2008), but this trend accelerated with the pandemic. The countries with advanced economies, which usually have mature housing markets, experienced stronger growth than countries with emerging economies. Real house price growth (accounting for inflation) peaked in 2022 and has since lost some of the gain. Although, many countries experienced a decline in house prices, the global house price index shows that property prices in 2023 were still substantially higher than before COVID-19. Renting vs. buying In the past, house prices have grown faster than rents. However, the home affordability has been declining notably, with a direct impact on rental prices. As people struggle to buy a property of their own, they often turn to rental accommodation. This has resulted in a growing demand for rental apartments and soaring rental prices.

In 2023, the average price of real estate in China was approximately ****** yuan per square meter, representing a decrease from the previous year. Rising prices in the real estate market Since the 1998 housing reform, property prices in China have been rising continuously. Housing in the country is now often unaffordable, especially considering the modest per capita income of Chinese households. Shanghai and Beijing even have some of the most competitive real estate markets in the world. The rapid growth in housing prices has increased wealth among homeowners, while it also led to a culture of speculation among buyers and real estate developers. Housing was treated as investments, with owners expecting the prices to grow further every year. Risk factors The expectation of a steadily growing real estate market has created a property bubble and a potential debt crisis. As Chinese real estate giants, such as China Evergrande and Country Garden, operate by continuously acquiring land plots and initiating new projects, which often require substantial loans and investments, a slowdown in property demands or a decline in home prices can significantly affect the financial situation of these companies, putting China’s banks in a vulnerable position. In addition, due to a lack of regulations and monetary constraints, the long-term maintenance issues of high-rise apartments are also a concern to the sustainable development of China’s cities.

In 2024, Poly Real Estate was the most active real estate developer in China, generating a sales revenue of approximately *********** yuan. Other leading companies were China Overseas Land & Investment Ltd. and Greentown China. Real estate market in ChinaWith more than ******************** real estate developers, China's real estate market is ranked among the world’s largest as of 2023, recruiting over *********** employees, and generating revenue from real estate sales that has increased tenfold between 2005 and 2021. China's real estate market has become a subject of debate for a long time, with the average real estate sale price per square meter in China skyrocketed from ***** yuan in 2008 to more than ****** yuan in 2023. However, different regions experienced substantially different price growth trends; as of 2023, Shanghai was the region in China with the highest sales price of real estate, followed by Hainan and the capital, Beijing. Future developmentConsidering the average income in the country, the housing prices in the largest cities are far beyond the affordability of an average household, even in suburb areas. China's central and western provinces had relatively less expansive real estate price. As a matter of fact, housing prices in China grew at a pace parallel to the country's GDP growth rate. The fluctuation of real estate prices is very likely to have a far-reaching impact on China's economic development; although the extremely high real estate prices in some regions of China are expected to fall, a sudden drop of housing prices would set off a chain reaction, leading to devastating consequences for the country's future.