Global luxury residential prices extended their gains through 2025, outperforming mainstream housing markets for the second consecutive year as resilient demand from wealthy buyers supported key cities worldwide.
The Prime International Residential Index, or PIRI 100, which tracks 100 high-end markets compiled by London-based consultancy Knight Frank, rose an average 3.2% last year, according to the firm's 20th annual Wealth Report. Prices advanced in 73 of the 100 locations, underscoring broad but uneven strength at the upper end of the market.
Tokyo led the way with a striking 58.5% surge in prime new-build apartment values, propelled by chronic supply constraints and robust demand. Dubai posted a 25.1% increase and retained its status as the world's most active market for homes priced above $10 million, recording roughly 500 such transactions during the year.
Regionally, the Middle East delivered the strongest performance with a 9.4% rise, followed by Latin America and the Caribbean at 4.7%. Asia-Pacific advanced 3.6% and Europe gained 3.3%. North America was the outlier, slipping 0.9% amid weakness in Canada.
Liam Bailey, editor of The Wealth Report comments, "In many markets, prime residential property has pulled away from the broader housing sector, underpinned by the strength of wealth creation. While mainstream markets remain exposed to wider economic pressures, the pace at which wealth is being generated is helping to keep demand for luxury property more resilient, even against recent volatility in debt costs."
A persistent shortage of high-quality, move-in-ready properties continued to underpin price premiums in the luxury segment. Affluent buyers are showing a clear preference for turnkey homes to sidestep construction delays and escalating renovation costs.
Shifting lifestyles among the ultra-wealthy are also reshaping demand. An increasing number of ultra-high-net-worth individuals are spending fewer than 90 days a year in traditional financial centers, boosting interest in luxury rental properties across multiple global destinations.
"UHNWIs are increasingly organising their lives across multiple jurisdictions, with family offices actively managing tax, lifestyle and political risk. As a result, established hubs such as London are shifting towards a 'dip-in, dip-out' model: places to spend time for business, culture and connectivity rather than permanent residence."
Looking forward, several markets appear poised for continued strength. Mumbai is projected to lead near-term gains with expected price growth of 8.7%, while Brisbane is gaining traction as a rising luxury hub. Miami has already seen prime prices climb roughly 67% over the past five years, and Hong Kong is displaying early signs of a rebound in its super-prime segment.
The data highlight a luxury housing market increasingly driven by cross-border capital flows, constrained supply, and more flexible living patterns among the world's wealthiest buyers.
