Luxury homes in some of the world’s top cities saw a slowdown in price growth in the last quarter as new taxes, elections, referendums and economic jitters took hold.
Despite an average annual growth rate of 3.8%, 18 of the 37 cities tracked by the Knight Frank Global Cities Index saw their rate of price growth slide compared with last quarter.
Key highlights:
· The index increased by 3.8% in the year to September 2016, down from 4.6% last quarter
· The rate of growth declined in 48% of the cities tracked by the index compared with last quarter
· Although still on top, Vancouver’s quarterly price growth slipped to 1.5% in the three months to September
· Europe is split, Dublin is Europe’s strongest performer and Paris the continent’s weakest
· Currency, in particular the trajectory of the US dollar, will be critical to future prime market performance globally
Elections and referendums tend to provoke a ‘wait-and-see’ approach in the minds of buyers evidenced in the run-up to the UK’s Brexit vote in June and the forthcoming US Presidential election.
Currency movements will be the single largest determinant of international demand in the world’s top cities over the next 6 to 12 months. Investors are increasingly looking to the US as their safe haven of choice as the world economy stutters, but a strong dollar will have repercussions globally.
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