Prime residential prices across 32 global cities have risen by 6.2% on an average this year, till June. In Mumbai, property prices have marginally increased by 0.8% and by 1.8% in Delhi, over the past 12 months, as revealed in the latest Knight Frank Asia Pacific survey report.
Knight Frank Asia Pacific is a global property brokerage and real estate research firm. As per the report, luxury homes in key US cities are now increasing in value at a faster rate than those in several European and Asian cities. "The 27 global cities recorded positive annual price growth in the year till June, up from 21, last year...The key Asian and European capitals dominated the bottom of the annual rankings, with US cities positioned at the top," stated the report.
With the gradual withdrawal of stimulus measures in the US and the UK, the prospect of rising interest rates and the continual enforcement of cooling measures across much of Asia, it would be logical to assume that the index's performance will be weakening.
Kate Everett-Allen, partner, International Residential Research at Knight Frank, said: "New York, Los Angeles, Miami and San Francisco, all recorded double-digit annual price growth in the past 12 months till June, placing them in the top 10 rankings."
In Dubai, prime prices rose by 6.3%, down from 11.7% last quarter. The mortgage cap and the doubling of transfer fees at the end of 2013 influenced buyer activity more than forecast, as new research by Knight Frank revealed around 25% of purchases are mortgage financed in the emirate. However, with new supply at the prime level seeming limited over the next 18 months, we expect prices to strengthen in the remainder of 2014.
"In Mumbai, property prices have shot through the roof. The budget of a 2BHK house in Greater Mumbai is beyond the common man's budget. Therefore, it has impacted the sale.
People are waiting for property prices to come down. Unless there is a significant correction in the property market, the sale and subsequently, the property rates, will not go up in the near future. The stagnation will continue for some time," said real estate expert Atul Nemade.
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