The global average price of prime residential property in 33 of the world’s major investment cities rose at their lowest rate in two years during the third quarter of 2014, new data shows.
According to the Knight Frank Prime Global Cities Index, luxury property prices in the world’s leading city markets rose by only 0.2 per cent in the three months to the end of September and by 4 per cent over a 12-month period.
“This moderate level of price growth is partly attributable to the fact that the third quarter, for much of the world, is dominated by the summer holiday season which often sees slower sales activity reducing the pressure on prices,” explained Kate Everett-Allen, a Partner in Residential Research at Knight Frank.
“Key events on the political and economic stage are also likely to have been contributory factors; the prospect of tightening monetary policy in the US, the approaching General Election in the UK, the persistence of cooling measures in key Asian cities and perhaps most pivotal, a new set of negative economic indicators emanating from Europe,” she added.
The latest data shows that Tokyo recorded the strongest quarterly growth (prices were up by an average of 9.2 per cent in the third quarter) whilst Jakarta saw the strongest annual rise in luxury property prices (up by 27.3 per cent on the same time last year).
On a quarterly basis, Cape Town (up 6.3 per cent) and San Francisco (up 4.6 per cent) were the next best performers, while the properties located in the Russian cities of St Petersburg and Moscow recorded the biggest price declines in this three-month period, falling by 13.4 per cent and 4.6 per cent respectively.
In yearly terms, after Jakarta the strongest luxury property price growth was recorded in Los Angeles (16.3 per cent) and Tel Aviv (14 per cent). The worst performing markets were found in Singapore (prices down by 10 per cent on the same time last year), St Petersburg (down by 6.7 per cent) and Geneva (down 5.6 per cent).
Article published 10th November 2014