Israel has continued as the best performer in Knight Franks Global House Price Index, having recorded an annual increase of +13.7% at the end of Q3 2009.

The recovery in global house prices continues with values increasing in 68% of the countries surveyed reporting prices changes for Q3 2009. House prices however are still down on 12 months ago in 57% of locations around the world. Dubai recorded the largest annual drop (-47%) but posted a modest increase of +1.2 in Q3.

Liam Bailey, Knight Frank’s head of residential research, said: “There is still a clear polarisation from the top to the bottom of the table. Israel remains the best performer on an annual basis and is the only country to have recorded double-digit growth during the past 12 months. Prices in Dubai have fallen the most, despite posting a small recovery in the third quarter. The recent debt issues with Dubai World and the subsequent loss of confidence by investors mean even this nascent rally is already under threat.”

Singapore saw the biggest rise in Q3 2009 with a +15.2% increase but is still down -14.5% on an annual basis, whilst Australia continued its upward trend with a +4.2% quarterly increase, which was matched by New Zealand. Thailand, however, had the highest drop in the region with a decrease in prices of -13.5% for Q3 and -18.4% annually.

Bailey said: “Other locations where growth is accelerating include Australia, which was relatively unscathed by the credit crunch. Many Asian economies are also performing strongly with quarterly growth of +6.3% in Hong Kong and +2.5% in mainland China. Q3 figures are unavailable for India, but prices were already rising in Q2 and that trend looks set to continue.”