Prime real estate assets in Hong Kong have experienced the highest annual growth rate - reaching 16.1 per cent - in the second quarter of this year, the latest data from Knight Frank has revealed. According to the company's Prime Global Cities Index, Hong Kong has seen property values rise by 75.9 per cent since the final quarter of 2008 and the upward trend appears set to continue for the time being.
Other cities to perform well include St Petersburg - which registered the greatest six-month percentage change with a 17.3 per cent increase - and Paris. In addition, Beijing, London, Shanghai and Zurich all saw positive growth between December 2010 and June 2011. Head of residential research at Knight Frank Liam Bailey pointed out that this price growth has cooled significantly, although stressed that this should not be a significant concern for investors.
"The fact is that prime residential markets have acted as 'safe-havens' for investors over the past two years - with growing demand for property in London, New York and other key global cities," he stated. He attributed the desire for such assets to the economic and political instability being experienced around the world, adding that investors have been keen to find "stable locations for their wealth".
Last month, head of investment management at London Central Portfolio Hugh Best described the UK capital's residential property sector as "a very secure place to keep your cash", adding that many foreign investors are turning to the city at this time. The Knight Frank report noted that conditions in London's prime market "remain strong" and predicted further price growth even though supply has increased over the past few months.
And despite Hong Kong's performance on the index, the firm pointed out that other Asian hubs - most notably Singapore - have seen rises in property values cool as measures taken by the government have helped rein in the market. The report commented that this is the "first evidence" to suggest the Asian property sector is heading towards "a new, more negative phase".
- Tuesday 09 August 2011