Countries across Asia and the Middle East are leading house price growth, with western cities like London, New York and Toronto lagging behind.
The analysis comes from Knight Frank’s global house price index, which placed Seoul in South Korea at the top of the pile, with annual house price growth of 18.4%, on top of a quarterly change of 2.3%.
Seoul’s growth is driven by rising wealth and increasing institutional activity in the luxury residential segment, the study said.
After that comes Dubai, with an annual increase of 16.4%, as well as a three-month change of 3.6%. Dubai’s house price growth actually decelerated in 2024 but now stands at double digits.
After that comes Tokyo, Japan, (15.5%), as well as Bengaluru (8.3%) and Mumbai (7.6%) in India.
While property markets in Asia are generally strong, key Chinese markets, such as Guangzhou (-4.7%) and Beijing (-3.2%) are struggling to see positive growth.
Liam Bailey, global head of research at Knight Frank, said: “The resilience of prime global property prices is evident, particularly in Asia and parts of Europe. However, to unlock the next phase of growth, markets need the support of lower borrowing costs.”
The top European cities are Lisbon (5.7%) and Madrid (5.5%), though London is lagging behind (-1.3%).
Growth is also stagnant in New York (0.6%), Toronto (-1.2%) and Melbourne (-2.1%).
Tariffs and future challenges
The direction of interest rates remains the pivotal factor for future price growth, Knight Frank said. Although inflation has been easing in many key economies, Donald Trump’s tariffs have created the potential for significant future volatility.
There is the potential for disinflationary pressures to increase outside of the US, while the US itself faces a risk of higher inflation. While expectations of interest rate cuts have risen outside of the US, there’s a need for greater clarity on the pace and extent of future cuts to stimulate further growth.
Given the global challenges, annual growth is predicted to range from +5% in Dubai to 0% in markets such as Singapore and Hong Kong.
