Global Cities Outlook _ Savills Prime Residential Index
Following two years of staggering growth, the prime residential markets are set to slow in 2023. Of the 30 major global cities in the index, 17 will record slower capital value growth than in 2022. However, 13 cities are forecast equal or even slightly enhanced growth in 2023 and rental markets will remain a bright spot.
Capital values rose by an average of 3.2% across the 30 cities we monitor in 2022, with the second half of the year only contributing 0.7% as the deteriorating economic situation and higher interest rate environment took effect.
Miami and Dubai recorded the highest level of capital value growth in 2022, at 25.4% and 12.4% respectively. These markets are still relatively competitively priced by global standards, the low cost of living, tax regime and warmer climates attracting international and domestic buyers.
The global hubs of Singapore (+6.8%) and New York (+6.1%) also performed well last year, benefitting from an inflow of high net worth individuals setting up businesses. New York, in particular, recorded the second highest number of $5m+ transactions since 2017.
Some cities felt the global economic turbulence more than others, particularly in the second half of 2022. Rising interest rates hit Sydney particularly hard, and earlier than On the horizon in 2023 The second half of the year holds potential for positivity other cities. Hong Kong’s lingering pandemicrelated restrictions continued to hamper its prime residential markets and prime prices fell by -8.5%, however it remains the most expensive prime residential market in the world, with prices at $4,070 per square foot.