Following a 124 percent surge since 2020, Dubai's real estate prices have shown a slight slowdown, dropping from a 15.9 percent rise in the first quarter to a 0.3 percent decrease in the second quarter, as reported by an international property consultancy. Globally, Manila leads the Knight Frank’s Prime Global Cities Index with a 26 percent increase. This index monitors the prime residential prices in 44 cities worldwide using valuation-based data, tracking nominal prices in local currency. The annual price growth across these 44 cities has decelerated from 4.1 percent in Q1 to 2.6 percent in Q2, significantly below the long-term average of 5.3 percent, indicating a need for lower rates to reignite growth.
Stockholm has shown the most significant improvement in annual growth for Q2 2024. Liam Baily, the global head of research at Knight Frank, noted that the slowdown in price growth across global prime markets this quarter underscores the necessity for additional stimulus from rate cuts to sustain the market rebound seen in recent quarters. The future of price growth heavily depends on central banks and their willingness to further reduce rates in the next 12 months.
Dubai, after a 124 percent increase since the start of 2020, is experiencing a justified pause. Notably, Miami, which saw a 77 percent rise since early 2020, is climbing back in the rankings with prices up by nearly 8.0 percent over the past year, according to the report. In the first half of 2024, Dubai recorded over 74,000 property sales, totaling Dh191 billion, a 38 percent year-on-year increase. Sales volumes also grew significantly, with a 36 percent annual increase.
Mumbai and New Delhi have seen their real estate prices rise by 13 percent and 10.6 percent respectively, while Bengaluru experienced a modest 3.7 percent increase. The premium segment has been the key driver of growth in the Indian market, reflecting in the price increases seen in Q2 2024. The rising affluence of the wealthy and their demand for lifestyle-oriented properties have boosted the prime residential market. This momentum is expected to continue in 2024, supported by a strong economic outlook and positive market sentiments, according to Shishir Baijal, chairman and managing director at Knight Frank India.
Europe is gaining momentum, with six of the ten fastest-improving markets, led by Stockholm. Conversely, markets such as Madrid, Dubai, and New Zealand (Christchurch, Wellington, and Auckland) are seeing a slowdown in growth, as indicated by the report.
