Following a substantial year of growth in 2021 (6.9%), average prime residential price growth for cities is forecast to hit 4.3% in 2022, but this positive outlook varies from city to city
Forecast to see the highest increase of the European cities we monitor in the Index, Berlin is expected to see prime price growth of at least 10% in 2022. It is set to benefit from a buoyant economy, strong domestic and international demand coupled with a shortage of stock. The German capital is still a comparatively less expensive prime residential location across the 30 cities in the Index.
Prime London’s residential market is expected to bounce back in 2022, forecast 6% to 7.9% growth. London’s cosmopolitan appeal and variety of prime property offerings will ensure affluent and international buyers return to the capital. Meanwhile, in Russia, policy changes have led domestic buyers to turn to prime Moscow residential real estate. A trend set to continue in 2022, with growth of 8% to 9.9% expected.
As Europe learns to manage the ongoing pandemic, interest rates remain historically low, and economies continue their recovery. Amsterdam, Geneva, Milan and Madrid are all anticipating strong growth between 4% and 5.9% in 2022. Paris is the only European city expecting to see comparatively muted growth in 2022, which will stabilise prices following seven consecutive years of growth.
Cities in Asia Pacific are forecast to see relatively mixed growth. Seoul, Singapore and Sydney are all forecast to grow by more than 4%, and governments are implementing measures to cool their prime markets. But in China, cities face a more subdued outlook. Policy tightening, future uncertainty around the real estate debt market, and tightening mortgage markets have weakened sentiment for the year ahead. Any revival of Hong Kong’s prime market will depend on the timing, and extent, of border reopening. Therefore the city looks set for achieving only muted price growth, as it has every year since 2019.
The Index’s North American cities are all forecast to grow above 4% in 2022; Miami has the region’s strongest prospects, with anticipated growth of 10%. Comparatively low prices, Florida’s appealing climate, and low taxes will support Miami’s future price growth. While in New York, rising domestic wealth, the progressive reopening of international borders, and city migration are the driving factors for the city’s resurgence. New York is forecast to grow between 4% and 5.9% in 2022, ending a run of softening prices in the city.
Read the articles within Savills Prime Residential Index: World Cities below.