The price of luxury residential property continues to rise across the globe, but the rate of increase has slowed in the last year.
The latest Prime Global Cities Index from Knight Frank, which tracks residential price movements across 35 cities world-wide, shows average values rose by 2.5% in the 12 months between June 2014 and June 2015. This is not as fast as the 5.2% rise between June 2013 and June 2014.
Prime property corresponds to the top 5% of the wider housing market in each city, and the index is compiled on a quarterly basis using data from Knight Frank’s network of global offices and research teams. Knight Frank uses records on local transactions as well as data sourced by its researchers.
The second-quarter index results released Monday show that while most of the cities recorded positive growth in the last year, the number of strong performing markets has declined.
A year ago, eight cities had double-digit annual price growth, but this year there are only four: Vancouver, where property prices rose 15% in the 12-month period; Miami, with 13.9% growth; Sydney, at 12.5%; and Bengaluru, up 12.3%. Kate Everett-Allen, partner of residential research for Knight Frank and the report’s author, said this is a result of low-interest rate environments, expanding economies and safe haven capital flows.
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Singapore’s property prices recorded the biggest decrease, with a drop of 15.2%, making it the weakest-performing luxury housing market for the sixth consecutive quarter.
Nevertheless, Everett-Allen said: “Asian cities are rising up the rankings with seven of the top ten cities now based in the Asia Pacific region.”
In Hong Kong, despite a new cooling measure–a 40% deposit is required for properties under HK$7 million (US$900,000)–luxury prices increased by almost 7% in the year to June, the report said.
The generally positive growth in this part of the world is reflected in figures on price rises since the collapse of Lehman Brothers in the third quarter of 2008. Luxury property in Jakarta, for example, has increased in price by 174.5% in this period, property in Beijing by 76.9% and Shanghai 64.7%.
London has been the best-performing European market in the past seven years, with the most expensive homes rising in value by 48.3%.
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