So far the pandemic has driven house prices in the mainstream housing market, but the prime sector is now surging ahead.
Price growth for luxury homes across 46 cities increased at an average rate of 8.2% in the year, up from 4.6% in the first quarter according to the Prime Global Cities Index by Knight Frank. In comparison, mainstream prices increased by 7.3% on average.
Toronto leads this quarter’s results recording annual prime price growth of 27%, driven by strong buyer appetite and
low inventory levels. Despite a recent cooling measures, the next three rankings are occupied by key Asian cities – Shanghai (21%), Guangzhou (20%) and Seoul (20%). Miami (19%) completes the top five.
An easing of travel rules in some markets, a surge in safe haven purchases by domestic buyers, a flurry of activity ahead of the tapering of stamp duty holidays, and an overall reassessment of lifestyles and commuting patterns, all set
against a backdrop of low interest rates have been causing the price increases.
Although not one of the top performing markets London registered a 0.7% uptick in prime prices, but it was the first time that prices saw positive growth since May 2016 and along with Paris and New York, these cities are forecast to increase in the rankings, as travel restrictions ease and international buyers start to recognise the relative value in these cities.
Top Five Prime Global Cities Q2 2021
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