Bugle Sales Talk Editorial

Author: Andreas Wassenaar
Date: 2015-05-15

Global prime residential markets have experienced an interesting change over the 2014-year according to Knight Frank's recently published Wealth Report. Their unique Prime International Residential Index tracks the pricing of 100 prime city and second home property destinations around the world to provide a very comprehensive view of the changes in demand within these destinations.

The value of luxury residential property around the world rose by just over 2% on average in 2014, lower than the 2,8% growth recorded in 2013, with significant reversals in markets as far apart as Asia, the Middle East and Europe. The US dominated the growth in 2014 taking four of the top ten positions with New York (+18.8% growth in prices) and Aspen (+16% growth) in first and second place respectively. Luxury prices rose by almost 13% on average across US cities last year, compared with an average of only 2.5% in Europe. Bali, the leading Asian second-home market, and the emerging Middle Eastern urban destination of Istanbul, both recorded +15% growth in luxury home prices taking joint third position in the rankings. Ireland has experienced somewhat of a re-surgance with Dublin taking 7th position with growth of +13.4% in its luxury home pricing. Two South African cities featured in the top 20 list. Cape Town appeared in joint 8th position with recorded growth of +13.2%, and Johannesburg in joint 19th position with +8.7% growth. Auckland in New Zealand with growth of +13% and Sydney in Australia with growth of +11% took the 11th and 13th positions in the top 20. Only two European cities featured in the top 20 list. These were Amsterdam in 16th position and Berlin in 18th position with recorded growth for 2014 of +10% and +9% respectively.

The previous front runner, Jakarta, which lead the rankings in 2012 and 2013 slipped to 12th place in 2014, indicative of the slowdown evident across many Asian cities last year. Previous strong markets such as Dubai saw prices slow markedly to +0.3% growth in 2014 from +17% growth in 2013. Prudent Macro Economic Government policy, through higher property taxes and mortgage market intervention, has provided a dampening impact on certain markets such as Hong Kong (56th position with growth of only +1.1%) and Singapore (98th position with prices declining -12.4% in 2014). In mainland China the same situation is being faced with prime price growth in Shanghai (0%), Beijing (-0.5%) and Guangzhou (0.6%) proving lacklustre. Hikes in the UK Stamp Duty have curtailed the rate of price growth for properties worth over Pounds Sterling 2m, with price growth in London limited to 5.1% for 2014. According to Knight Frank the average price of a luxury home in their index is 38% higher than the low point in the second quarter of 2009, and has outperformed the average price of mainstream global property, which has risen 14% over the same period.

Five global prime residential hotspots were featured in the Knight Frank Report and included Main Road, Green Point in Cape Town. Excellent infra-structure, access to amenities, sporting facilities, amazing views and the lifestyle offering provided by world-class restaurants are what make for a highly desirable global destination. Cape Town features along side London, New York, Dubai and Hong Kong as a global prime hotspot.

For further information and an interactive analysis of this article follow my blog: andreaswassenaar.blogspot.com.

Andreas Wassenaar

Principal - Seeff Dolphin Coast

Cell: 082 837 9094

andreasw@seeff.com

Springclean

Enlarge View Link

Nissan T5ekton

Enlarge View Link