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Mumbai ranks third globally for steepest luxury home price rise
Prime Global Cities Index, covering 44 cities across the world, Knight Frank Prime Global Cities Index showed that with 11.5% annualized growth in premium real estate prices, Mumbai ranked third only next to Manila (26.5%) and Tokyo (12.5%)
Premium real estate prices in the Mumbai and Delhi have registered a strong boost in the first quarter of the year, registering 11.5% and 10.5% annualized growth, respectively.
The first quarter of 2024 witnessed an average annual growth rate of 4.1% across the 44 markets covered
by the Knight Frank Prime Global Cities Index, marking the strongest rate of growth since Q3 2022 – a period when interest rates were surging and nearly 70% of central banks were tightening monetary policy.
With annual GDP growth running at over 8%, strong economic growth across India has boosted house prices in the main cities, particularly in Delhi and Mumbai, the report said.
With 11.5% annualized growth in premium real estate prices, Mumbai ranked third only next to Manila (26.5%) and Tokyo (12.5%).
The third Indian city covered by this index, Bengaluru, ranked 17th, showing a 4.8% jump in the prices of luxury homes compared to the Jan-March quarter of 2023. The prices of premium real estate in the Southern Indian city reported a 3.7% surge in the last six months and a 3% hike from the prior quarter.
In a comparable period last year, Mumbai (5.5%) ranked 6th among the 46 leading markets covered by Knight and Frank for this index. Bengaluru (3%) and Delhi(1.2%) were at 16th and 22nd rank in the Jan-March quarter of 2023.
International property consultant Knight and Frank publishes a quarterly index reflecting percentage changes in premium real estate prices in 44 cities worldwide. The latest index in the first quarter of 2024, was marked by the surge in interest rates and nearly 70% of central banks tightening monetary policy, mentioned the property consultant in its release.
Knight and Frank shared that the current annual growth of 4.1% denotes a notable recovery from zero growth seen at the end of 2022. However, the growth percentage is below the long-term average annual growth rate of 5.4%. The property consultant mentioned that quarterly growth at 1.3% is now aligning with the long-term quarterly average.
Of the 44 cities considered for this index, 78% reported a price surge, while 19% saw declines. The index showed that the rate of price declines has lowered from a year ago. In the April-June quarter of 2023, nine cities reported a decline in prices of luxury homes by more than 5%. In the Jan-March quarter of this year, only Frankfurt reported a drop in prices by more than 5%. The weaker markets in the Prime Global Cities Index reported a continuation of the negative impact of higher interest rates that negatively affected affordability.
“The rebound in global housing markets is continuing, as evidenced by our Prime Global Cities Index reaching 4.1% annual growth. Rather than heralding a return to boom conditions, the index indicates that upwards price pressures are stemming from relatively healthy demand, set against continued low supply volumes. The pivot in rates – when it comes – will encourage more vendors into the market, leading to a welcome return to liquidity in key global markets.” Said Liam Bailey, Knight Frank’s global head of research.