Guangzhou is world’s hottest luxury housing market
Led by the southern city of Guangzhou, China’s luxury housing markets are driving up the price index for high-end residences around the globe, according to Knight Frank’s latest “Prime Global Cities Index” report. The luxury price index rebounded with a growth of 4.3% in Q1 of 2017 after witnessing a slowdown in Q4 of 2016, partly thanks to robust real estate investment in China’s major cities.
Guangzhou’s luxury housing prices climbed 36.2% over the year until March, just ahead of Beijing’s 22.9%The DailyBriefMust-reads from across Asia - directly to your inbox
Guangzhou’s luxury housing prices climbed 36.2% over the year until March, just ahead of Beijing’s 22.9%. Coming in at third in China is Shanghai, with a 19.8% rise. Clocking in at a global number three as the only other city that saw a more than 20% price growth in prime properties was Toronto, at 22%. Knight Frank defines “prime properties” as ones that are in the top 5% of the corresponding city’s housing market.
Last quarter, Shanghai was on top, with a 27.4% growth over a 12-month period, while Guangzhou came in at number three. Knight Frank researcher Kate Everett-Allen writes that this is because “prices in Guangzhou are rising from a lower base than in Shanghai and Beijing, the availability of residential stock is tighter, and policymakers in the city were slower to introduce cooling measures which are now widely evident across most tier-one cities.”
The trend is also apparent as emerging luxury consumers in China are leading their global peers in confidence when it comes to purchasing a home. A Sotheby’s International Realty report found that 53% said they would buy a home in the next year, while 92% said they would purchase a home in the next three years, compared to 33% and 78% in the United States respectively.
However, when it comes to luxury property investment abroad, capital controls are making it increasingly challenging for wealthy Chinese consumers to purchase real estate in major high-end property hubs, including in and around New York City, as well as Melbourne and Sydney.
This article was originally published on Jing Daily.