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Why are housing prices so high in some cities like London and New York?
Housing prices in cities like London and New York are driven by high demand, limited supply, and factors like foreign investment and local economic strength. Long-term shortages of housing and high income inequality also contribute to soaring prices, making affordability a major issue.
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Which cities are struggling most with housing affordability?
Cities such as London, Hong Kong, and parts of Sydney face severe affordability issues, with average house prices often many times higher than local salaries. These markets are characterized by high demand, limited land, and regulatory constraints that restrict new development.
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How are governments trying to control or boost their housing markets?
Governments use various measures like interest rate adjustments, land supply management, and restrictions on foreign buyers to influence housing markets. For example, South Korea has restricted foreign purchases to cool prices, while Australia has expanded first-home buyer schemes to help more people buy homes.
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What is the outlook for global real estate prices in the coming years?
The future of global housing prices varies by region. Some markets, like Dubai, expect a supply-driven correction starting in 2026, while others may see continued price growth due to strong demand. Overall, local economic conditions, policy changes, and demographic shifts will shape the trajectory of prices worldwide.
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Why do some markets slow down despite government support?
Even with government incentives or easing policies, markets can slow due to factors like rising interest rates, economic uncertainty, or oversupply. For instance, Shanghai's luxury housing market has slowed despite policy easing, as buyers become more cautious amid price cuts.
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How does foreign investment impact housing prices?
Foreign investment can significantly drive up prices in popular cities by increasing demand for limited housing stock. Restrictions on foreign buyers, like those in South Korea, aim to reduce speculative demand and stabilize prices.