_The PIRI 100: The winners & losers across prime property markets in 2017
Sydney
Although Sydney’s mainstream residential market has cooled, in part due to tighter lending rules for investors, the prime end experienced strong growth of close to 11% in 2017 as a lack of stock, in particular detached homes, put pressure on prices. A transformation of the Sydney Harbour foreshore is now under way with an impressive array of infrastructure and super-prime residential projects scheduled.
Berlin
A prospering economy and its relative value have propelled Berlin high up the wish list of global investors. An historic undersupply of new homes combined with low home ownership rates, a stable political landscape and high quality of life have boosted demand. Prime prices typically start at €10,000 per sq m. Investors are seeking apartments in waterfront and central areas.
Hong Kong
Prime prices increased by 7.3% in 2017. Tight supply and strong outbound capital flows from mainland China have boosted price growth despite more stringent capital controls and taxation changes.
Neighbourhoods such as The Peak, which set a new record price in 2017, and Mid-Levels are among the most desirable. Further US interest rate rises in 2018 may slow but are unlikely to halt price growth.
Los Angeles
A strong regional economy, shrinking inventories and limited supply have protected prices in Los Angeles despite three rate rises in 2017. Domestic demand has proved steady and although the appetite of international buyers dipped marginally due to the strength of the US dollar, UK and European buyers remain active. Prime prices ended 2017 just over 5% higher, with gated communities in Beverly Hills and Malibu outperforming the city average.
Cape Town
In 2017, Cape Town’s luxury residential market outperformed the city’s wider mainstream market by some margin. The area near Table Mountain, including the Atlantic Seaboard and City Bowl, attracted strong inward migration from other parts of South Africa, to add to already significant foreign buying activity.
Against a backdrop of constrained supply – landlocked between the mountain and the coastline, development opportunities are scarce – prime prices increased by almost 20% year-on-year.
