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Manila Has Ranked First Globally In Knight Frank’s Prime Global Cities Index.
Dubai’s real estate market has experienced an extraordinary 124% surge in property prices since 2020. However, recent data from an international property consultancy indicates a slight moderation in this rapid growth. After an impressive 15.9% increase in the first quarter of 2024, Dubai’s property prices saw a marginal decline of 0.3% in the second quarter. This adjustment suggests that the market might be catching its breath after such an intense period of growth.
Global Real Estate Trends: Manila Leads the Way
On the global stage, Manila has emerged as the top performer in Knight Frank’s Prime Global Cities Index. With a remarkable 26% increase, Manila now leads this index, which tracks the movement of prime residential prices across 44 cities worldwide.
The index focuses on nominal prices in local currencies and reveals some notable trends. Overall, price growth across the tracked cities slowed from 4.1% in the first quarter to 2.6% in the second quarter of 2024. This latest growth rate is significantly lower than the long-term average of 5.3%, underscoring the need for more favorable interest rates to reignite substantial growth.
In Europe, Stockholm stands out as the most improved market in terms of annual growth for Q2 2024. This suggests that specific European markets are gaining momentum, even as others begin to slow down. Madrid, Dubai, and cities in New Zealand, including Christchurch, Wellington, and Auckland, are experiencing a deceleration in growth, according to the report.
The Role of Central Banks and Future Outlook
Liam Bailey, Global Head of Research at Knight Frank, emphasized that the recent slowdown in price growth across global prime markets reflects the diminishing impact of recent market stimuli. Without further rate cuts, the pricing bounce seen in the past few quarters is losing steam.
The future of global property prices heavily depends on central banks’ confidence in cutting rates further over the next year. Dubai, which has seen a 124% rise in property prices since early 2020, may be poised for a brief pause. However, other markets like Miami, another significant Covid-era riser with a 77% increase since 2020, are showing signs of a resurgence.
Miami’s property prices have risen by nearly 8% over the past year, positioning it as one of the top performers in the latest rankings.
Indian Market Gains Momentum
India’s real estate market is also on the rise, with Mumbai and New Delhi recording annual increases of 13% and 10.6%, respectively. Bengaluru, while more modest, has seen a 3.7% rise. The premium segment remains India’s primary driver of sales growth, driven by the growing affluence of the wealthy and their desire for lifestyle-oriented properties.
This trend is expected to continue in 2024 as India’s solid economic outlook keeps market sentiments positive, according to Shishir Baijal, Chairman and Managing Director at Knight Frank India. While the global real estate market shows signs of slowing, specific markets, mainly Europe and Asia, are still experiencing significant growth. The outlook for 2024 will largely depend on central banks’ policies and their willingness to implement further rate cuts to stimulate the market.
