Knight Frank, the independent global property consultancy, today launches the Global Residential Cities Index for Q4 2017 which tracks the performance of mainstream house prices across 150 cities worldwide, of which 44 are from Asia-Pacific. This quarter also marks the inclusion of German cities for the first time.
Highlights:
- Average global prices increased by 4.5% in 2017, down from 7% a year earlier.
- Berlin – the only city on the index registering growth over 20% – led the annual rankings for 2017 with annual price growth of 20.5%.
- Chinese cities registered a marked slowdown in 2017 averaging 1.6% growth year-on-year; the same 15 cities averaged 23% growth in 2016.
- US cities averaged 6.3% growth in 2017, despite four rate rises since December 2016
- Seville and Hong Kong stand out as the most improved markets in 2017 registering the largest rise in annual growth between Q4 2016 and Q4 2017.
Kate Everett-Allen, International Residential Research at Knight Frank, highlights, “At the end of 2016, 12 cities, most of them Chinese, registered price growth above 20%, a year later only one city falls into this category: Berlin.
Nicholas Holt, Head of Research for Asia-Pacific, Knight Frank, explains, “2017 saw Asia-Pacific residential city markets slow from the previous years, with just six markets seeing double-digit annual price growth – down from 22 cities in the previous year.
“With tighter liquidity, extensive cooling measures and the start of global monetary policy normalisation, we expect growth for most cities in the region to remain subdued.”
David Ji, Director, Head of Research and Consultancy for Knight Frank Greater China noted that there were no Mainland cities among the top 10 list whereas there were nine a year ago. He thinks that this is attributed to Chinese policies that allow cities to adopt their own bespoke housing measures that stifle speculation in tier-1 cities at the same time encourage absorption in the tier 2 and 3 cities. Meanwhile, local demand has driven Hong Kong’s house price to grow 14.8% year-on-year in 2017 compared to just 4.2% for the whole of 2016, although this year we are looking at a more subdued 5-10% growth.