Knight Frank, the independent global property consultancy, launches the Prime Global Cities Index, which tracks prime residential prices across 37 global cities worldwide. The index increased by 4.4% in the year to June 2016, its highest rate of growth over the last two years.
Results for Q2 2016:
- Vancouver leads the rankings for the fifth consecutive quarter. Prime prices have increased by 36.4% in the year to June but July saw the surprise announcement that the British Colombia Government plans to introduce a new 15% tax for foreign buyers, effective from 2 August 2016.
- Other top performers this quarter include Shanghai (22.5%), Cape Town (16.1%), Toronto (12.6%), Melbourne (11.0%) and Sydney (10.2%); all saw annual price growth reach double figures in the year to June.
- A breakdown by world region shows Australasia is on top, prime prices increased by 11% on average year-on-year
- Hong Kong has eclipsed Taipei this quarter to take the title of weakest-performing residential market. Prime prices slipped 8% in the year to June as supply increased and concerns over the slowdown in the local economy persisted.
- The majority of our top ten ranking cities have been on the receiving end of new cooling measures in the last 12 months.
Nicholas Holt, Asia Pacific Head of Research, says, “The latest move by policy makers in Vancouver to apply an additional tax for foreign buyers has mirrored some of the similar moves over the last few years in Asia-Pacific. For example, the Australian states of Victoria, Queensland and New South Wales have also recently introduced various additional levies for foreign buyers.
David Ji, Director, Head of Research and Consultancy, Greater China, says, “Prices in Hong Kong’s luxury sector has dropped 8% since the last peak of mid-2015, and dropped 3% since the beginning of this year. This in large part reflects buyers’ concern of the prospects of the Hong Kong economy amid global uncertainties. However we see over the mid to long term this decline is gradual. We maintain our 2016 forecast of a 5-10% drop in luxury prices”.