High-rise tower buildings along the central Sheikh Zayed Road in Dubai on July 3, 2023.
Karim Sahib | Afp | Getty Images
Dubai’s luxury home prices surged by nearly 50% in the year up until June, maintaining its top ranking for the eighth consecutive quarter, according to a new report by Knight Frank.
According to data released Wednesday from the property consultancy firm, prices in Dubai have skyrocketed 225% since hitting a pandemic low during the third quarter of 2020. The Emirate kept its crown in the ranking for the eighth consecutive quarter.
Taking second and third places were Tokyo, which saw an annual 26.2% rise, and Manila, which climbed 19.9%.
Other noteworthy increases were China’s Shanghai, which added 6.7%, and Singapore, which rose 4.2%.
“The influx of expatriates to Singapore, driven by the thriving financial and professional services sector, has impacted the rental market more than the sales market,” the report observed, noting that the discrepancy is partly owed to taxation for purchases by foreign buyers.
Ever since the end of April, foreigners purchasing residential property in Singapore have to pay 60% additional buyer’s stamp duty, double the 30% from before.
Hong Kong’s prices slipped 1.5% over the past year as a result of a surge in unsold inventory from newly developed projects. In an effort to stimulate demand, the Hong Kong government raised its mortgage loan-to-value ratio to 70% for residential properties valued at 15 million Hong Kong dollars ($1.9 million) or less.
However, Knight Frank’s analysts said that while the change is likely to be welcomed by buyers, the move’s ability to “significantly boost” growth is still uncertain.
Other slumps include New York, which dropped 3.9%, and San Francisco which recorded a 11.1% plunge. Germany’s Frankfurt was at the bottom of the list with a 15.1% dive.
Across the board, average annual prices added 1.5% across the 46 markets under the Knight Frank Prime Global Cities Index.
“Global housing markets are still under pressure from the shift to higher interest rates,” Knight Frank’s Global Head of Research Liam Bailey said.
However, he noted that the results from the index are an affirmation that prices are supported by strong underlying demand, weak supply following the disruption to new building projects during the pandemic, as well as the return of workers to cities.
“As uncertainty over the direction of inflation appears to have reduced in recent months – price adjustments in many markets are likely to be less pronounced than was expected even three months ago,” Bailey added.