Dubai saw the steepest house price growth globally over the past year despite government cooling measures, Knight Frank's Global House Price Index shows.
House prices grew 27.7 percent over the 12 months to March 2014, the fastest pace among the 54 countries tracked on the index. However, house prices only climbed 3.4 percent in the first quarter, much slower than 9.2 percent growth in the same period last year.
Authorities in Dubai doubled transfer fees and restricted mortgages in October last year to cool the housing market, Knight Frank said noting the measures appear to be taking effect.
China and Estonia were ranked second and third on the list with price growth of 17.5 percent and 16.2 percent, respectively.
Meanwhile, the U.S., Australia and Iceland joined the top ten rankings alongside emerging markets like Turkey and Brazil. Prices in the U.S. rose 10.3 percent over the past year, while prices in Australia and Iceland jumped 10.9 percent and 9.7 percent.
Of the fourteen countries that saw annual price declines only two were in Asia: Singapore and Japan.
According to Nicholas Holt, head of research for Asia Pacific at Knight Frank, cooling measures and tighter mortgage conditions were responsible for the slowdown in Singapore, while in Japan, Abenomics has failed to result in house price growth thus far.
All other countries that saw price declines were in Europe. Croatia, Cyprus and Greece were the weakest performers on the list with prices declines of 9.7 percent, 8.7 percent and 8.4 percent, respectively. However, Knight Frank said that house prices in Europe are falling at a slower rate.
On a regional basis, the Middle East saw the fastest annual and quarterly price rises, followed by South America. Meanwhile, Europe saw the slowest pace of quarterly growth, while annual growth was negative.
Overall growth slows
Overall, the pace of global house price growth slowed; Knight Frank's index rose 0.6 percent in the first quarter of 2014, slower than 1.2 percent growth in the fourth quarter. On an annual basis, global house prices rose 7.1 percent.
According to Knight Frank analysts, sales transactions often peak in the final quarter of the year as buyers rush to complete sales before the New Year when new tax rules often come into effect, leading to a quieter market in the first quarter.
"We expect to see the index's performance strengthen again in the second quarter," added Knight Frank's Holt.
"All eyes will remain on central banks, in particular the Federal Reserve, the Bank of England and the European Central Bank. The issue is not when interest rates rise but the speed and extent to which they do," he added.