Paris, Berlin and Madrid are forecast to lead luxury real estate price growth in 2019, according to a recent report from Knight Frank.
High-end homes in the three European cities are set to see prices rise 6% next year each, underpinned by their comparative value, the estate agency and property consultant said.
“The normalisation of monetary policy, weaker economic growth and a fragile political landscape post-Brexit will influence demand, but the relative value of these cities remains a key driver,” said Kate Everett-Allen, partner of international residential research at Knight Frank, in the report.
Overall, prime price growth will be dampened in 2019, Knight Frank predicts. Knight Frank analysed 15 major cities worldwide, and many are predicted to see prices stumped by freshly introduced property market regulations, the rising cost of financing, Brexit uncertainty and a high volume of new prime supply.
Markets that have had new financial regulations introduced this year, such as Hong Kong and Singapore, will see prices decline as buyers and developers adjust to new taxes. In Hong Kong, prices are predicted to fall by 10%, in Singapore they’re set to remain flat at 0%.
Vancouver, which saw a 20% tax on foreign buyers and higher stamp duty introduced this year, is an exception, according to Knight Frank. Though ranked as the weakest prime market of 2018, Vancouver is expected to see prices rise 3% in the coming year as local buyers invest.
In Sydney’s prime market, a lack of new supply is set to push prime prices up 2% next year. In London, where 2016’s changes to stamp duty have now been fully absorbed, prices are predicted to rise 1% as activity strengthens amid hopes for more political certainty following the U.K.’s departure from the European Union in October.