In 2012, Miami, Dubai, and London were among the top global cities with double-digit price growth.
According to a new Global Cities Report from London-based real estate consulting firm Knight Frank, fifteen of the 26 cities tracked by the Prime Global Cities Index (58%) experienced flat or positive price growth in the year to September, but 20 of the 26 cities (77%) experienced flat or positive growth in the last quarter, indicating an improving situation. buy and sell qatar
The index is presently 18.7% higher than its financial crisis low in Q2 2009, with Hong Kong, London, and Beijing being the best performers over this time, with price increases of 52.9 percent, 45.4 percent, and 39.5 percent, respectively.
In the year to September, five cities — one from each of the five major world regions — saw double-digit price increases: Jakarta, Dubai, Miami, Nairobi, and London.
Highlights from the Knight Frank Global Cities Report for the third quarter of 2012
In the three months to September, the index increased by 1.1 percent, down from 1.4 percent the previous quarter.
In the 12 months leading up to September, prime prices in the 26 cities examined by the index climbed by 3%.
Cities across Europe continue to be the worst performers, with an average decline of 0.5 percent over the last 12 months.
Jakarta was the best-performing city in the year to September (up 28.5%).
The combination of economic instability and a lack of high-performing alternative asset classes is driving up demand for luxury real estate.
Although Asia leads the pack with 28.5 percent annual increase in Jakarta, the findings this quarter imply that demand for luxury residences is only tangentially tied to regional economic strength (Asia Pacific has just two cities in the top ten, compared to Europe’s three). The movement of international wealth and the attitudes of HNWIs, on the other hand, are becoming increasingly powerful.
Cities like Dubai, Miami, Nairobi, and London are becoming more and more popular as investment hubs for HNWIs in their respective regions. Following the Arab Spring, Dubai has become a safe haven for MENA purchasers, while Venezuelan and Brazilian investors have turned to Miami to minimise their exposure to domestic political and economic turbulence.
The global economic instability isn’t helping all excellent home markets. Despite the fact that prices were stable in the third quarter, sales activity in Paris was limited as buyers of all nationalities took a “wait and see” approach. Vendors are refusing to lower prices until President Hollande and the leaders of the Eurozone provide more clarity on the debt situation.
Due to regulatory efforts aimed at lowering costs and boosting domestic affordability, Asia’s major markets appear to be entering a period of more sluggish growth.
“Aside from London, it would appear that the other strong performers are either those established international markets that experienced a lull but are now ‘kicking on’ again (e.g. Miami, Dubai) or those that could be described as second tier international cities — strong established markets, but not as strong as London,” James Price of Knight Frank’s International Residential Development team tells World Property Channel.
“While some of the more conventional top second-home markets are experiencing negative movement, this should not obscure their long-term popularity and strength; rather, it indicates a cooling from past higher levels,” James says.
According to Teresa King Kinney, CEO of the Miami Association of Realtors, “Miami is a truly global metropolis that has reaped the benefits of international buyers and investors in a way that no other city has. Miami’s international appeal resulted in a quick and strong rebound in 2011, with an all-time high in sales and exceptional inventory absorption. The Miami residential real estate market has experienced more than ten months of straight double-digit price rise as a result of this demand. More importantly, Miami’s status as a major worldwide market will continue to drive demand from both domestic and international buyers for many years to come, enhancing the value of our city, market, and assets.”