Manila has emerged as the world’s hottest market for prime residential properties during the third quarter of 2023, overtaking Dubai, according to the latest report by property consultancy Knight Frank. The ranking is based on the price appreciation recorded over the past 12 months in major cities across the globe.
Manila‘s prime residential properties have seen a significant increase of 21.2% over the past year, driven by both domestic and foreign investments according to the report. This growth marks the third consecutive quarter that Manila has claimed the top spot.
Dubai, despite experiencing a 15.9% year-on-year increase in prices, slipped to the second spot in the ranking. Meanwhile, Shanghai, China’s largest metropolis with over 28 million residents, moved up two spots to secure third place with a 10.4% annual price increase.
Hong Kong, on the other hand, faced a decline in the value of its “prime” homes, defined as the top 5% of the residential market in terms of value. These homes lost 1.7% of their value over the year and decreased by 0.6% in the third quarter compared to the previous quarter.
Globally, average prices rose by 2.1% in the 12-month period leading to September, indicating a sign of stabilization in housing markets, despite higher mortgage rates. Nonetheless, lingering uncertainty remains due to the potential for further interest rate hikes, as 63% of cities reported an increase in prices from the previous quarter.
The global housing market, including the luxury segment, remains affected by ongoing uncertainty related to inflation and interest rate risks. A more sustained increase in demand and pricing is anticipated only when rates start to decrease, a change not expected before mid-2024, as cautioned by Knight Frank.
