Manila, Beijing rank top in Asia for luxury price rises

Berlin in the global lead while Shanghai falters

Cityscape of Makati, Philippines. caporegime01/Shutterstock

Luxury residential prices in Manila grew 6.2 percent year-on-year in the second quarter of 2019, the fastest for Asia among 46 cities tracked by Knight Frank’s latest quarterly Prime Global Cities Index.

The Philippine capital, a new hub for China’s offshore gaming industry, trumps Beijing, which ranks second-fastest in the region and ninth worldwide for a price leap of 4.5 percent over the same period. Delhi, in 10th place worldwide, recorded an annual price growth of 4.4 percent in Q2 2019.

Tier-1 mainland Chinese cities such as Beijing and Guangzhou saw prime price growth strengthen in the first half of 2019 as optimism grew surrounding the potential relaxation of housing policies, the report noted.

Berlin crowns the index with an annual rise of 12.7 percent, although this is slower than the 14.1-percent uptick recorded in Q1 2019.

More: Beijing slams Manila’s plans for Chinese gaming workers

Frankfurt trails Berlin with an annual growth of 12 percent, up from the increase of 9.6 percent in Q1 2019.

Prime prices in Berlin and Frankfurt currently hover around EUR11,500 per square metre (USD12,761) and EUR13,500 per sqm, respectively, but they “remain competitive by European standards,” Knight Frank stated.

The index, which tracks the top five percent of the luxury housing market, saw Vancouver on the other end of the chart, with a crash of 13.6 percent in prices in the year to June. Shanghai is Asia’s weakest prime market with a 3.5-percent annual drop in prices, followed by Seoul with a decrease of 3.4 percent.

Sluggish economies explain the wave of interest rate cuts evident in the last three months as policymakers try to stimulate growth, Knight Frank analysts said. In the three months to June, interest rates were down by as much as 75bps in New Zealand.

Auckland ranks as the third worst-performing market globally with prices down by as much as 7.5 percent.