Luxury Home Prices Forecast to Rise Globally This Year—but Not as Much as Expected
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Luxury Home Prices Forecast to Rise Globally This Year—but Not as Much as Expected

Increases of 4.4% are in the cards, down from 6.1% growth forecast at the end of 2021, according to Knight Frank.

By V.L. HENDRICKSON
Thu, Aug 11, 2022 9:40amGrey Clock 2 min

Inflation, rising interest rates and other uncertainties have cooled price growth predictions for luxury homes in cities around the world, according to a Wednesday report from Knight Frank.

Prices of high-cost homes in 25 global cities are expected to rise 4.4% on average in 2022, down from 6.1% in December 2021, the data showed.

“Despite the reduction…this still represents strong growth, outpacing our prime index’s performance in nine of the last 10 years,” Kate Everett-Allen, Knight Frank’s head of international residential research, said in the report.

Nine of the cities tracked in the report are set to see stronger price appreciation than predicted at the end of 2021, with 11 now expected to see less robust growth than anticipated and five remaining unchanged, the report said.

Miami and Dubai landed in the No. 1 spot for price growth, with both cities expected to see prices rise by 12% this year, the data showed.

“However, for both prime markets this represents a slowdown compared to their stellar performances in 2021,” Ms. Everett-Allen continued

Price growth for luxury homes in Auckland has slowed the most—22%—followed by Seoul and Vancouver, which saw drops of 12% and 5%, respectively, since the end of last year.

In Auckland, tighter lending laws were introduced at the end of 2021, plus six interest rate rises starting in October, are behind the shift in buyer sentiment “from a fear of missing out to a fear of overpaying,” the report said.

Although growth is set to slow in 2023, many cities will still see prices increase.

In the U.S., Miami and Los Angeles are predicted to see the largest price acceleration, 8% and 7%, respectively. London (6%), Madrid (6%) and Seoul (5%) are also in the top five cities for price growth next year.

“Overall, we expect more muted price growth in 2023, averaging 2.8% growth across all 25 cities,” Ms. Everett-Allen noted.

Reprinted by permission of Mansion Global. Copyright 2021 Dow Jones & Company. Inc. All Rights Reserved Worldwide. Original date of publication:  August 10, 2022.



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London’s Luxury Property Market Turns a Corner

After more than a year, prices have finally levelled out in prime central London, while outer London saw a small uptick in high-end prices from the previous quarter

By CASEY FARMER
Fri, Mar 29, 2024 2 min

The first quarter of the year brought some long-awaited signs of recovery in London’s luxury housing market, offering the first positive quarterly price growth since September 2022, according to a report from Savills on Wednesday.

After six consecutive quarterly price falls, luxury home prices in central London levelled out in the first three months of the year, with a 0.1% quarterly uptick in prices. The £3 million to £5 million (US$3.79 million to US$6.32 million) market saw a slightly larger increase of 0.3%.

Outer London’s luxury market saw greater quarterly price growth, with home prices up 0.8%, as some stability returned to mortgage costs and lured more buyers back to the market, according to the report.

All of this is evidence that the market is “in early stages of recovery,” according to Lucian Cook, head of residential research at Savills.

“The outlook for the housing market has certainly improved, partly because the mortgage market has recovered more quickly than expected,” Cook said in the report. “With the first rate cut rapidly coming into view and recessionary risks easing, greater stability has returned to the cost of mortgage debt, which has positively impacted domestic prime markets, where many buyers rely on borrowing, most notably in leafy outer prime South and West London, as well as the commuter belt.”

Outside of London, prices across the U.K. saw no quarterly growth heading into the beginning of the spring market, which is expected to bring higher levels of buyer activity in many regions.

Suburban regions saw prices dip just 0.1%, while urban areas—like Edinburgh and Glasgow in Scotland, and Bath and Oxford in England—saw prices increase by 0.6%.

Cook said regional buyers are more likely to be concerned about market uncertainty than London buyers in the lead up to the general election.

“As a result, buyers are still expected to be less committed until the dust has settled,” he said.

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35 North Street Windsor

Just 55 minutes from Sydney, make this your creative getaway located in the majestic Hawkesbury region.

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This stylish family home combines a classic palette and finishes with a flexible floorplan

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