London, UK-A new study by Knight Frank predicts that luxury home prices will rise faster than expected just six months ago. Sydney leads Knight Frank’s major home price forecast for 2021, with luxury prices in the city expected to rise by 10% annually.
However, in 2022, Australia’s largest cities will share the top spot with London, with prime prices projected to accelerate 7% year-over-year in both cities. This rise represents the strongest annual price performance in central London in almost seven years.
Global Prime Price Forecast by City
Annual rate of change (as of June 2021)
Since the outbreak of the pandemic, Knight Frank’s global research team has implemented three prime price forecasts, with an overall higher average forecast each time. In May 2020, Knight Frank expected a prime price to rise by an average of 1% in 2021, which changed to 3% in December 2020 and is now 4% in July 2021. I am.
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Kate Everett Allen, Head of International Housing Research at Knight Frank, revealed the driving force behind the forecast: Banks in major developed markets have offered mortgage holidays to their customers, reducing foreclosures and foreclosures. Households earned a total of over US $ 5 trillion in savings worldwide during the blockade, allowing some homeowners to renovate their homes, while others relocated, increased in size, and downsized. Or chose to buy a second residential / investment property. “
Tax and lending incentives also motivated buyers. From stamp duty holidays to relaxed loan-to-value ratios, many householders have taken advantage of lower purchase costs and access to mortgages with less deposit.
The blockage has reduced construction rates and social distance has exacerbated the shortage of new supplies in some major cities, putting upward pressure on prices.
Changes in work patterns have led some homeowners to rethink their lifestyles, eliminating five-day commuting in some industries and allowing them to move to the suburbs and countryside.
The award for the most improved market was given to Sydney, with the 2021 forecast rising 7% from 3% in December 2020 to 10% in July 2021. Wealthy Australians buy domestically, not abroad, due to the closed borders.
In the first quarter of 2021, 1429 prime sales were recorded. This is Sydney’s record quarterly number, and despite the recent blockade, momentum has been maintained.
Hong Kong and New York are not far behind Sydney, with 2021 forecasts rising 5% and 4%, respectively, between December 2020 and June 2021.
Martin Wong, Head of Research and Consulting at Knight Frank Greater China, said: 2021.
Economic forecasts have been revised upwards, with 35% of the population being first vaccinated, and sentiment improving with capital flows from mainland China as a major driver. “
The outlook for New York is even brighter. “New York is back, restaurants are crowded, flights are full, Yankee Stadium is full, and American companies are bringing back workers,” said Liam Bailey, head of global research at Knight Frank. Stated.
Like London, the 4% price increase we envision in 2021 will bring New York back to a positive price increase for the first time since 2018, demonstrating the strongest performance since 2015. ..
Due to its strong international prejudice and strict travel bans, the prime market has undoubtedly operated during the pandemic against a more difficult background than the mainstream housing market.
In some cities, this means that the effects of loose travel arrangements are beginning to be felt and are likely to be in 2022 before prime sales gain momentum, but Miami, Auckland, Hong Kong and Geneva. In other cities such as, domestic prime buyers are absent from non-residents.
The outlook for the major housing markets is closely tied to the ease with which cross-border transactions begin to normalize, with virtual display and improved technology helping in this area, but in reality, commercial The key is to resume your air travel.
Key factors that may boost or hinder the prime market over the next 12 months:
Sydney will become the world’s strongest prime real estate market in 2021, but will share its top position with London in 2022.
Source link Sydney will become the world’s strongest prime real estate market in 2021, but will share its top position with London in 2022.