Three Indian cities recorded an increase in average annual prices of prime residential or luxury homes—Mumbai (6.5 per cent) New Delhi (4.1 per cent), and Bengaluru (2.2 percent)—in Q3 2023, states Knight Frank in its report, ‘Prime Global Cities Index Q3 2023’.
Data from the report show Mumbai registered the fourth highest y-o-y growth in prime residential prices in Q3 2023. With a 6.5 per cent increase in prime residential prices, the city has moved up from 22nd rank in Q3 2022. New Delhi and Bengaluru too recorded an upward movement in their index rankings. NCR moved from 36th rank in Q3 2022 to 10th in Q3 2023 with a growth of 4.1 per cent y-o-y , while Bengaluru’s rank increased from 27th rank in Q3 2022 to 17th rank in Q3 2023 with a y-o-y growth of 2.2 per cent.
Meanwhile, the average rise in annual prime residential prices across the 46 markets was recorded at 2.1 per cent in the 12-month period ending September 2023. This is the strongest growth rate recorded since Q3 2022 and reflects 67 per cent of cities seeing growth on an annual basis, according to the report.
Manila claimed the top spot in the ranking with a 21.2 per cent annual rise in prices. Manila’s performance is attributed to strong domestic and foreign investments. Meanwhile, San Francisco was the weakest-performing market, with a decline of 9.7 per cent y-o-y.
Shishir Baijal, Chairman and Managing Director at Knight Frank India, said, “The robust price trend in the upper end of the market coupled with strong sales momentum has elevated Mumbai’s position in this global ranking scale. Sales momentum is significantly stronger at higher ticket sizes today than it has been in the past five years.
Prime Global Cities Index is a valuation-based index tracking the movement of prime residential prices across 46 cities worldwide. The index tracks nominal prices in local currency.
According to Liam Bailey, Knight Frank’s Global Head of Research, the improvement in average annual house price growth will be welcomed by prime-market homeowners but shouldn’t be overstated. “Higher rates mean we have moved into a world of lower asset price growth, and investors will need to work harder to identify opportunities for outperformance to secure target returns,” he added.