The South African Bureau for Economic Research reported that building costs rose 13.5 percent in the last quarter of 2004, more than triple the rate of inflation. In Sri Lanka, there are concerns that rising home-construction costs will compromise the number of tsunami-destroyed homes that might be rebuilt. "The escalation of the building materials is a serious concern," says Mano Tittawella, chair of the state tsunami reconstruction agency, the Task Force for Rebuilding the Nation. "If the price escalations go beyond a certain point, the number of houses built will be less," he cautioned.
A midlevel office worker who bought a house in a middle-class Sydney, Australia, suburb for 188,000 Australian dollars (US$142,600) in 1996 would have been offered about 720,000 dollars (US$540,000) for it in 2003, according to a recent story in The New York Times. Soaring prices lifted the average deposit put down by a first-time buyer in Great Britain to £33,000 (US$58,554), though the British housing market has slowed considerably in the past 18 months. Still, the number of people who buy their first home before they are 25 has slumped to its lowest level in at least 20 years.
In South Korea, the government has stepped into the fray, with an announcement in July that it will rein in speculation by strictly controlling development projects in highly volatile areas, such as southern Seoul, and by imposing new property tax measures on expensive homes and additional tax burdens on speculative profits.
In Spain, overall house prices have risen more than 140 percent in the past seven years.
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