Bengaluru 26th fastest-growing residential market globally in Q2: Report
Knight Frank’s Prime Global Cities Index, an unweighted average of the change in prices across 45 cities, hit its lowest rate of annual growth since October – December 2009 quarter (Q4-2009) when the world was in the grip of the global financial crisis (GFC). It expects the index to display muted growth in the second half of 2020 before recovering in 2021. The global real estate consultant defines prime residential property as the most desirable and most expensive property in a given location, generally defined as the top 5 per cent of each market by value.
“Prices increased by 0.9 per cent on average in the year to June 2020, down from 2.3 per cent in the March 2020 quarter,” the Knight Frank survey released Monday revealed.
Despite this, Bengaluru was the 26th fastest-growing prime residential market in the world in terms of annual price appreciation among major Indian cities. The premium micro-markets of the city recorded a rise of 0.6 per cent in annual capital value change in Q2-2020 on YoY to an average price of Rs 19,727 per sq. ft. New Delhi, on the other hand, was ranked 27th on the global index, with a 0.30 YoY per cent rise in terms of annual capital value change in the prime residential market to an average price of Rs 33,625 per sq. ft. in Q2 2020. In Mumbai, however, prices dipped 0.6 per cent YoY to Rs of Rs 64,388 per sq. ft. and the city was ranked 32nd on the above-mentioned index.
That said, only 16 cities of the 45 surveyed have seen a fall in capital values with Bangkok, Nairobi, London, Hong Kong and Dublin at the bottom of the pyramid that saw 3.8 per cent to 5.8 per cent YoY dip in capital values across the residential property segment. Manila, Tokyo, Stockholm, Moscow and Geneva, on the other hand, saw the highest appreciation in capital values during the period under review on a YoY basis.
“Analysis by world region shows prime prices in Australasia and North America were the most resilient in Q2 2020. In cities such as Sydney, Vancouver and Los Angeles higher value properties, often large detached homes, are in demand, which is supporting prime residential values in these regions,” the Knight Frank report said.
Even on a sequential-quarter basis, the residential capital value performance has been polarized with cities like Vancouver and Cape Town seeing property values climb over 3 per cent during this period. Zurich, Dubai, Madrid and Auckland are some of the cities where the prices dipped quarter-on-quarter (QoQ), the findings suggest.