City Climbers

While global luxury residential prices have remained stagnant in world-class cities such as London and New York, several second-tier cities have witnessed price increases, a trend reflected in the prime prices in those areas, according to Knight Frank’s 45-city index report.

The prime price index released by the real estate consultancy firm has gone up by 1.1% in Q3 - the lowest rate of growth in the last five years. It tracks the movement in prime residential prices in 45 cities worldwide. And for the first time, includes Bucharest (0.7%), the capital and largest city of Romania.

The slowing price growth is reeling from political uncertainties around the world, Knight Frank said. The intensifying trade relations between the U.S. and China, Hong Kong’s political tensions, a looming U.S. presidential election in 2020 and the ongoing Brexit debate are among buyers’ concerns.

Moscow leads the index this quarter with 11.1% growth, partly because of a number of high-end projects in exclusive neighbourhoods, the report said. The Russian capital is followed by Frankfurt (10.3%), Taipei (8.9%), Manila (7.4%) and Berlin (6.5%) in the top five.

Meanwhile, a number of Asia’s secondary cities, including Taipei, Manila, Guangzhou and Delhi, have climbed up in the index.

Due to infrastructure improvements, the southern Chinese city of Guangzhou was in the sixth spot, boasting the strongest rate of growth over the last five years, according to the report.

Luxury sales volumes are at their weakest in several years in many first-tier global cities, Knight Frank noted. Traditional top markets such as London, New York, Hong Kong and Dubai are all among the bottom 10 of the list.

Overall, South Korea’s capital city, Seoul recorded the weakest rate of annual price growth at -12.9% compared to last year.

https://www.mansionglobal.com/articles/second-tier-cities-show-strong-growth-on-prime-global-cities-index-209155