European cities defy moderation of prime prices though
The “Great Moderation” continues, Knight Frank stated in its latest Prime Global Cities Index.
Prime residential prices across 45 cities worldwide posted an annual growth of 1.3 percent as of the first quarter of 2019. This marks the lowest rate of annual global growth for luxury prices since the final quarter of 2009 at the height of the financial crisis.
“What’s changed? Although still rising, the rate of wealth creation globally slowed in 2018. The last six months saw political and economic headwinds intensify,” wrote Kate Everett-Allen of Knight Frank’s International Residential Research.
The threat of a global trade war loomed in the first three months of 2019 — a fear that was compounded by uncertainty surrounding Brexit, Knight Frank noted. The IMF also projected that 70 percent of the world’s economies would see a slowdown in growth this year.
For perspective, prime prices were rising at an average rate of 4.3 percent per annum two years ago.
Berlin recorded the hottest prime price increase in the year to Q1 2019. The German capital’s 14-percent year-on-year growth puts it well above Asia’s top placer Tokyo, which showed an annual price increase of 8.4 percent for properties above JPY100 million (USD912,900).
Moscow, with a prime price increase of 12 percent, has risen to second place worldwide, buoyed by high-end launches in prime districts such as Ostozhenka last year.
Delhi is at number seven worldwide, second in Asia, with a luxury price growth of 5.8 percent in the year to Q1. Seoul placed last in Asia with an annual price drop of 5.8 percent.
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