New figures indicate that the Asia-Pacific has overtaken Europe to become the world’s biggest real estate market.
Data released by integrated property services firm DTZ shows that the Asia-Pacific sector surged by nine per cent in the past year to surpass Europe as the world's biggest real estate market.
According to DTZ's Money into Property report, the Asia-Pacific real estate market is now estimated to be worth US$4.6 trillion, as compared to the European market, which is valued at US$4.4 trillion, and grew by a modest two per cent over the same period.
North America came in third, with investment stock worth a total of US$3.9 trillion.
A study by insurance firm Allianz of the world's biggest skyscrapers further attests to the momentum behind surging property growth in the Asia-Pacific. A whopping 50 per cent of the world's tallest skyscrapers are now located in Asia, while half of the highest buildings constructed in the past four years were situated in China, the Middle East or Southeast Asia.
Analysts believe the chief force behind the surge in the Asia-Pacific property sector is growth in China, which has seen compound annual growth of 32 per cent over the past decade and recently surpassed Japan as regional leader.
The Middle Kingdom's contribution to regional growth is further underpinned by the fact that the key markets of Japan and Australia went backwards during the past year as a result of the devaluation of their currencies against the greenback.
DTZ's data indicates that China is now the second largest national market in the world behind the United States.
While concerns amounting about the development of a bubble in the Chinese property sector as well as recent signs of a slowdown, DTZ's global head of research Hans Vrensen allayed concerns about the possibility of a meltdown in the market.
"The problems in China will not be as severe as in Europe, because the leverage ratios are not the same," Vrensen told the Financial Times.
DTZ's figures indicate that gearing in China is at 54 per cent and still below the figures for North America and Europe, which sit at 65 per cent and 56 per cent respectively.