Prime residential rents in key locations around the world are struggling to achieve growth, increasing by just 0.5% in the 12 months to the end of March 2017, the latest Prime Global Rental Index from Knight Frank shows.
However, over 70% of the 17 cities tracked by the Index did see a rise of varying levels, led by Cape Town with an annual rent rise of 5.9% while Nairobi saw rents fall by 6.2%.
On a regional basis, the Middle East saw the strongest rise in prime rents, up 1.7%, and Europe recorded the weakest with a
fall of 0.3%.
While the number of cities where prime rents have increased on an annual basis rose from six in the first quarter of 2016 to 12 in the first three months of 2017, the general trend has been for steady, rather than spectacular growth.
“Indeed, it is worth noting that while prime rents are following an upward trajectory, in recent years they have been overshadowed by prime price growth, putting pressure on investment yields,” said Taimur Khan, a senior research analyst at Knight Frank.