The global property bubble
Forget equities, the real post-pandemic action has been in property. And not just in the UK – it is a worldwide phenomenon.

Forget equities, says Mike Bird in The Wall Street Journal. The real post-pandemic action has been in property. This “larger and slower-moving market” is still the place where most wealth is to be found. Even in America, a land of compulsive stockmarket investors, real-estate wealth amounts to $44,349 per adult, compared with $34,008 in stocks and bonds, according to Credit Suisse.
Property prices plunged globally after the 2007 financial crisis, but this time round banks are in “much ruder health” and more willing to lend. Prices are up in almost every wealthy country over the past year. In New Zealand they surged by 21.5% in the year to February.
It’s been a year since the housing market closed as the pandemic took hold, says Melissa Lawford in The Daily Telegraph. For a short period you could snap up multimillion-pound central London property at a 25% discount as sellers panicked. Yet by the summer the stamp-duty holiday was driving a new boom that has continued ever since. “Sales outpaced supply at the fastest rate in 14 years” in February, says the Royal Institution of Chartered Surveyors.
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The “great reshuffling”
Global superstar cities such as London and New York were the big property winners of the past decade, says The Economist. No longer. Prices in Manhattan fell by 4% last year. In what US property website Zillow dubs the “great reshuffling”, prices are now rising fastest in suburbs within commuting distances of big cities but offering more space. If remote-working endures post-Covid-19, then that trend will not fully reverse. The pick-up has been broad-based: US house prices are up 11% over the last year; German prices rose by 9%. Across 25 rich countries “only in Japan” have prices retreated over the past 12 months.
Australia, the country where the property bubble never quite seems to pop, has been enjoying yet another boom, says Matthew Burgess on Bloomberg. A cocktail of low interest rates and housing undersupply saw prices advance by 2.8% in March, the biggest monthly gain since 1988. Prices are up by 6.2% on the year. Goldman Sachs thinks Australian property could rise by another 15% over the next two years as people seek more space to set up home offices.
Perhaps nowhere has the boom been more frenetic than in Canada, says Ian Austen in The New York Times. Exceptionally generous pandemic stimulus saw the country run a deficit of about 19% of GDP last year. Now house hunters have cash to splash. In Vancouver the price of a detached home surged by 13.7% in the year to February. In Toronto the equivalent index soared by 23.1% over the same period. Analysts wonder if this bubble is about to burst, and no wonder: a “rundown, one-car garage” in the city recently sold for C$729,000 (£419,000).
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Alex is an investment writer who has been contributing to MoneyWeek since 2015. He has been the magazine’s markets editor since 2019.
Alex has a passion for demystifying the often arcane world of finance for a general readership. While financial media tends to focus compulsively on the latest trend, the best opportunities can lie forgotten elsewhere.
He is especially interested in European equities – where his fluent French helps him to cover the continent’s largest bourse – and emerging markets, where his experience living in Beijing, and conversational Chinese, prove useful.
Hailing from Leeds, he studied Philosophy, Politics and Economics at the University of Oxford. He also holds a Master of Public Health from the University of Manchester.
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