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Australasia sees highest average price growth

02 March 2016

Knight Frank, the independent global property consultancy, today launches the 10th edition of The Wealth Report 2016 that includes the Prime International Residential Index (PIRI) looking at the performance disparity of prime residential property across 100 locations, of which 19 cities are from Asia Pacific. 

Across the world regions, Asia Pacific sees some of the highest average price growth, largely contributed by the 12.3% increase from the strong performing cities in Australasia. Within Asia, price performance was more of a mixed bag in 2015, with Hong Kong and Singapore seeing negative price growth, while Chinese Tier-1 cities saw prices rebound. 

 

PIRI by world regions

World region

Average annual % change

(Q4 2014 – Q4 2015)

Australasia

12.3

North America

6.2

Asia

2.5

Russia/CIS

2.3

Middle East

1.1

Europe

0.8

Caribbean

-1.3

Africa

-1.6

Latin America

-2.7

Mr Nicholas Holt, Head of Research for Asia Pacific, says, “Average price growth across Asia Pacific prime residential markets moderated slightly from 4.2% in 2014 to 4.1% in 2015. This was largely on the back of slower growth rates in Southeast Asian markets, including negative growth in Singapore and Kuala Lumpur. Australia – led by Sydney and Melbourne – and New Zealand saw some of the strongest price growth, while Tier-1 Chinese cities saw a strong rebound amidst stock market volatility. With the backdrop of global economic uncertainty, property could see its safe haven status reinforced throughout 2016.”  

Highlights of PIRI 100

  • The value of the world’s leading prime residential property markets rose on average by 1.8% in 2015 – similar to the 2% overall growth seen in the previous year.
  • Vancouver topped the chart at 24.5% growth.
  • The cities in Australasia – Sydney, Melbourne and Auckland – recorded double-digit annual price growth, up 15%, 12% and 10% respectively.
  • Of the 34 locations where prime prices slipped in 2015, 22 of these were located in Europe. 

Zooming in on Asia

·         Bali and Shanghai have interestingly swapped positions

o    Bali, which was the top Asian city at third position last year dropped to 64th position this year with no price growth.

o    Conversely, Shanghai at 61st position with no price growth last year is today the only Asian city that entered the top 10 chart, taking the third position with 14.1% growth.

·         Eight Asia Pacific cities emerged as Top 20 compared to five last year. 

o    Apart from Bali which had dropped off the chart, Shanghai, Bangkok, Melbourne and Seoul joined the ranks of the top 20 with Auckland, Jakarta, Sydney and Bengaluru which were on the chart since last year.

·         Singapore (ranked 81; -2.1%), Hong Kong (ranked 91; -3.6%) and Taipei (ranked 93; -4.7%) are the bottom three Asian cities among the 19 featured across Asia and Australasia. 

Most expensive residential property

·         Monaco, Hong Kong, London and New York retained their top 4 positions since last year.

o    Monaco – for the ninth consecutive year – is confirmed as the most expensive city to buy luxury residential property, with US$1m buying just 17 square metres of accommodation.

o    Hong Kong and London occupy 2nd and 3rd places offering 20 and 22 square metres respectively for US$1m.

·         Geneva has displaced Singapore from the 5th position.

·         Beijing has climbed two positions from last year to enter the top 10 list. 

Tay Kah Poh, Executive Director and Head of Residential for Knight Frank Singapore, comments, “Singapore luxury property prices have dropped for several years now, and while the reasons for the fall are still in place – overall slowing economy, volatile financial markets, rising rates and government cooling measures – fundamental value is clearly emerging. 

"Based on the Attitudes Survey, Singapore (and Dubai) are widely regarded by respondents to be the two strongest contenders to the primacy of London and New York as the top global wealth hubs. This perhaps could be a precursor to a robust rebound in the Singapore luxury property market when macro-economic conditions turn for the better and/or the Singapore government reverses some of the cooling measures.”  

The square metres of luxury property US$1m will buy around the world (As at Dec 2015)

Rank

City

Sqm

1

Monaco

17

2

Hong Kong

20

3

London

22

4

New York

27

5

Geneva

40

6

Sydney

40

7

Singapore

42

8

Shanghai

46

9

Paris

57

10

Beijing

58

Rank

City

Sqm

11

Los Angeles

65

12

Rome

75

13

Miami

77

14

Moscow

83

15

Tokyo

83

16

Istanbul

94

17

Berlin

96

18

Mumbai

99

19

Sao Paulo

203

20

Cape Town

255

Source: Knight Frank Research / Douglas Elliman 

Notes: Price ranges for Hong Kong, Beijing and Shanghai are for properties considered “Super-Prime”. Prices used in the calculation for Sydney and Hong Kong are based on apartments only and for New York, Los Angeles and Miami based on condos only. All currency calculations are based on the prevailing rate on 31 December 2015.

 

To download the report, please visit:
http://www.knightfrank.com/wealthreport

 

For further information, please contact:
Mr Nicholas Holt, Head of Research, Asia Pacific
nicholas.holt@asia.knightfrank.com +65 6429 3595 @nholtKF 

 

Ms Rachel Loke, Head of Public Relations & Communications, Asia Pacific
rachel.loke@asia.knightfrank.com +65 6429 3587 @knightfrank

 

Ms Lixia Liew, Manager, Marketing & Communications, Singapore
lixia.liew@sg.knightfrank.com +656228 7358