London, England (PRWEB UK) 30 January 2012
Knight Frank results for Q4 2011 headlines:
Overall, the index rose 3% in 2011, Asia Pacific fell by 1%
The index recorded only marginal growth of 0.2% in the final quarter of 2011
Nairobi (up 25%) was the strongest performer during 2011
Property in Mumbai fell the most (-18%)
The value of prime property in the worlds key cities rose by only 0.2% in the final quarter of 2011.
Although the Knight Frank Prime Global Cities Index, which tracks the performance of the worlds leading luxury residential markets, rose by 3% during 2011, the second half of the year saw the pace of growth slow considerably.
The luxury housing market is now seeing the pace of price growth slip for the second time since the 2008/09 global financial crisis. In this latest cycle annual price growth peaked at 11.5% in Q2 2010 but has since slowed each quarter.
Post the Lehman collapse European and North American cities were largely responsible for the indexs slump. Since late 2010 it has been the Asian cities which have dampened price inflation. In Q2 2010 prices in Asia Pacific were rising at an average rate of 23.6% each year, the comparable figure now stands at 1%.
Anti-inflationary price cooling measures implemented by Asian governments, combined with worries that the Eurozone sovereign debt crisis will affect the global economy, have created a more cautionary climate.
The slowdown in the luxury Asian markets has highlighted the extent to which the old-world cities of London, New York and Moscow are outperforming the overall index. London and Moscow have ranked highly for several quarters but Manhattans recovery is gathering momentum. Foreign demand for luxury homes in New York is not only strengthening, but is also starting to diversify with Chinese nationals increasingly evident, particularly in the $ 1-$ 3m sector.
Paddy Dring, head of Knight Franks International team comments Despite cooling price growth in the second half of 2011, the worlds prime markets continue to outperform their mainstream housing markets, providing some justification for their safe-haven reputations. The flight of capital towards the worlds luxury neighbourhoods increased in 2011 as geo-political events in the Middle East and North Africa took hold and the tumultuous global economy weakened the viability of a number of alternative asset classes.
Price growth in 2012 will continue to be underpinned by this flight of capital from troubled world regions. This, combined with a desire amongst wealthy investors to target property and other real assets over financial products, will reaffirm prime propertys safe-haven qualities in 2012.
View Knight Frank Prime Global Cities Index, Q4, 2011
For further information, please contact:
Kate Everett-Allen, Residential Research, Knight Frank, +44 (0)7876 791 630,
Kate.Everett-Allen[at]knightfrank.com
Bronya Heaver, International PR manager, Knight Frank, +44 (0)20 7861 1412, Bronya.Heaver[at]knightfrank.com
Ends
Notes to Editors
Knight Frank LLP is the leading independent global property consultancy. Headquartered in London, Knight Frank and its New York-based global partner, Newmark Knight Frank, operate from 242 offices, in 43 countries, across six continents. More than 7,067 professionals handle in excess of US$ 817 billion (