Australia’s property market has been named as one of the best in the world, thanks to a 20 per cent increase in house price growth last year.
According to a report of 47 countries by Knight Frank, Australia ranked fourth in terms of house price growth.
Knight Frank’s head of residential research Liam Bailey said the stellar growth in property values was driven by a combination of a 40 year low in interest rates, the increased first home buyer’s grant and population growth.
"With interest rates now rising, the government withdrawing stimulus and the supply response picking up, we expect house prices to slow over the next six to nine months," Mr Bailey said.
China was the top performing country with house prices gaining 68 percent in the year to March 2010 with Hong Kong and Singapore taking second and third places respectively.
According to Mr Bailey, the overall results indicated that the global recovery is now gaining ground as the proportion of countries moving into positive territory increases.
“It remains to be seen whether this is another period of sustained growth or the middle peak in a double dip recession. Certainly, a number of European economies face growing challenges in the form of tightening fiscal policy and austerity measures,” he said.