The latest (Q4 2017) Global Residential Cities Index by Knight Frank has revealed that house price across 150 of the world’s biggest cities increased by 4.5% compared to Q4 2016.
A year earlier this figure was closer to 7% however, signalling that global property price growth is slowing down considerably. With fiscal stimulus being withdrawn, capital controls in place in China (stemming the flow of overseas property investment by Chinese investors) and the beginning of a shift towards the normalisation of monetary policy (rising base rates), annual price growth above 20% is now confined to only a few outliers.
Kate Everett-Allen, international residential research at Knight Frank, says: “At the end of 2016, 12 cities, most of them Chinese, registered price growth above 20%. A year later only one city falls into this category - Berlin.
The German property market has been outperforming
Everett-Allen added: “Germany’s capital leads the rankings with prices ending the year 21% higher. Strong population growth, a stable economy, record low unemployment and robust interest from overseas investors are together propelling prices higher. As housing markets become more transparent and new official indices are published we review the composition of the index to optimise our city coverage. This quarter marks the inclusion of German cities for the first time.”