Overall, Knight Frank lowered its predictions for global high-end real estate in 2023 amid surging mortgage rates and subdued economies
Dubai’s high-end home market is set to lead the world in property price appreciation in 2023, a year that is now on track to perform worse than predicted six months ago, according to a report Tuesday from Knight Frank.
Across the luxury markets of the 25 major cities analyzed by the real estate agency and consultant, prime prices are set to rise on average by 2% next year, down from the 2.7% Knight Frank forecast in June.
“At a time when homeowners are having to contend with the unpredictability of soaring inflation, the rising cost of debt and higher taxes, the landscape in most global cities is now shifting,” Kate Everett Allen, head of global residential research at Knight Frank, said in the report, which noted that it would still put aggregate growth in 2023 above that recorded in six of the last 10 years across Knight Frank’s prime residential markets.
Indeed, prime prices would need to drop by 30% to 40% in some cities to return to their pre-pandemic levels of 2019, the report added.
Dubai, with predicted annual price growth of 13.5% next year, leads the forecast for 2023.
Miami follows at a distant second, with expected gains of 5%, and Dublin, Lisbon, Madrid, Los Angeles, Paris and Singapore are all anticipated to log 4% price increases across their high-end markets.
New York ranked jointly with Tokyo, both at 13th place, with price growth of 2% in the cards.
London and Seoul, meanwhile, were the duo at the end of the table. Both cities are predicted to see their prices drop by 3% next year.
Of the cities tracked, 11 are now expecting to see weaker price growth in 2023 than Knight Frank forecast earlier in the year; for 10, the outlook has remained unchanged; and four of the 25 cities—Zurich, Vancouver, Paris and Singapore—are now expected to see stronger price growth in 2023 than originally thought.
“With substantial headwinds facing the global economy, a more severe market slowdown may have been expected,” Liam Bailey, global head of research at Knight Frank, said in the report. “However tight supply, the search for income from investors and currency opportunities will, we believe, put a floor under pricing in prime markets.”
Of the cities tracked, 11 are now expecting to see weaker price growth in 2023 than Knight Frank forecast earlier in the year; for 10, the outlook has remained unchanged; and four of the 25 cities—Zurich, Vancouver, Paris and Singapore—are now expected to see stronger price growth in 2023 than originally thought.Prime Lands $947M Refi for West Coast’s Largest Multifamily Property
