Luxury residential markets globally witnessed a 5.2 per cent year-on-year jump in 2022 on the back of wealth preservation, safe-haven capital flight and supply constraints, according to a report unveiled on Wednesday by property consultancy Knight Frank.
“Omiting 2021, the year 2022 posted the highest level of prime price growth on an annual basis (5.2 per cent) since the global financial crisis, “ said Kate Everett-Allen, partner, of residential research at Knight Frank.
Residential property emerged as the safest and least volatile asset class, with one out of every three ultra-high-net-worth individuals globally looking at investment in residential real estate to hedge against inflation in 2023, a survey by the consultancy revealed.
Luxury residential prices in Dubai rose by a whopping 44.2 per cent in 2022, retaining its top position on the consultancy’s Prime International Residential Index (PIRI 100) which analyses luxury property prices in 100 cities globally.
Mumbai’s property market in the category witnessed a price appreciation of 6.4 per cent moving it up to the 37th position on the PIRI 100 in 2022 as opposed to 92nd in 2021. Prime properties in Mumbai are expected to witness an appreciation of 3 per cent in 2023, the report highlighted.
Bengaluru’s luxury property market registered an appreciation of 3 per cent helping the city climb up to the 63rd position on the index in 2022 from 91st in 2021.
Moving forward, three key themes - the reopening of China post the Covid-19 curbs, the resilience of the US economy and the rise of India - will significantly chart the way for the sector this year, Chairman of Knight Frank India Shishir Baijal underscored during an online conference on Wednesday.
Elaborating on possible headwinds which could dent investment inflows from the wealthy, into India, Baijal listed inflation, crude oil prices and the war in Eastern Europe, emphasising that India is not decoupled from the global economy.
How much real estate can $1 million buy?
Monaco continues to top the list of the world’s most expensive cities where 1 million of the greenback can get you 17 square metres (sq m) of space, followed by Hong Kong (21 sq m) and New York (33 sq m) in 2022.
Mumbai, ranked as the 18th most expensive prime residential market in the world by the consultancy can buy one 113 sq m of luxury property for $1 million making the city affordable by 13 per cent (in dollar terms) since 2018.