With a rise of 4.4 percent in capital value over the past one year, National capital New Delhi has emerged as the 10th fastest growing city globally for luxury residential real estate, says the latest report by Knight Frank. In the 46 cities tracked by Knight Frank globally, Bengaluru with a rise of 2.8 percent in capital value year-on-year and Mumbai (up 0.8 percent) are ranked 15th and 30th respectively.
According to the report, New Delhi, by virtue of limited supply of luxury properties saw a rise in weighted average of capital values at Rs 33,511 per square feet – an annual rise of 4.4 percent. Bengaluru recorded a weighted average capital value of approximately Rs 19,000 per square feet, recording an annual increase of 2.8 percent. Mumbai saw a weighted average capital value for prime properties at Rs 64,764 per square feet.”
Topping the table are Berlin with a growth of 12.7 percent and Frankfurt with a rise of 12 percent and capital value over the past one year. Berlin’s annual growth has slowed from 14.1 percent in March 2019 to 12.7 percent in June 2019, although it leads the index. Comparatively, Frankfurt, has seen its annual price growth increase from 9.6 percent to 12 percent over the same period.
“With prime prices in Berlin and Frankfurt currently around €11,500 per square metre and €13,500 per square metre respectively they remain competitive by European standards,” says the Prime Global Cities Index report by Knight Frank for the second quarter of 2019 (Q2-2019).
As per the report, The Prime Global Cities Index, which tracks the movement in luxury residential prices across 46 cities, rose 1.4 percent in the year-to-June 2019, up marginally from 1.3 percent in March 2019 but still significantly lower than its four-year average of 3.8 percent.
Out of the 46 cities tracked by the index, 35 of them registered price growth in the year to June 2019. Istanbul (-9.9 percent) and Vancouver (-13.6 percent) were the weakest markets of the eleven that saw prices decline year-on-year.
According to Knight Frank, the road ahead for the luxury residential real estate remains challenging as policy-makers grapple with a slowdown in economic growth and resort to cutting interest rates.
Liam Bailey, global head of research in this co-authored report with Kate Everett-Allen, their international residential research head said: “Much hinges on the next three months with stronger headwinds on the horizon we expect the Prime Global Cities Index to moderate further in the second half of 2019 before strengthening in 2020.”