House prices in the rich world are booming

ON A SUNNY afternoon in Kingsmere, a new suburb of Bicester, a town 50 miles (80km) north-west of London, the streets are abuzz with people strolling and children playing. In ten years 1,600 homes have been built on the site, and another 900 are soon to follow. In the sales office for Bovis Homes, Flip Baglee says she has “never known it to be so busy”. Sentiment in Rhinebeck, a village 80 miles north of New York City, is similarly buoyant. Many of the properties advertised in the window of Gary DiMauro Real Estate—from mansions to cottages—are already taken.Kingsmere and Rhinebeck are not the only places warming up. rose by 11% in the year to January, the fastest pace for 15 years. increased by 8% last year, and in Germany by 9%. The pattern is seen in much of the rich world (see chart 1). Across the 25 countries tracked by , real house prices have risen by an average of 5% in the latest 12-month period.