Prime property price growth slows across major ASEAN cities

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bangkk-mahanakhon-tower
Bangkok’s skyline with the newly opened MahaNakhon tower, a luxury residential development

Real estate consultancy Knight Frank in its latest research on prime residential property prices in tier-1 cities around the world, entitled Prime Global Cities Index, found that price growth has been slowing down in a number of regions, including ASEAN and some cities in East Asia.

Within ASEAN, price growth in the third quarter of 2016 was just 0.5 per cent in Singapore and 0.1 per cent in Jakarta and zero in Bangkok. In Kuala, price growth reversed to -0.6 per cent. All cities but Jakarta were given a negative outlook, Jakarta itself a flat forecast.

In the wider region, Hong Kong looks better. The special administrative region, where luxury residential prices are 4.7 per cent below their second quarter of 2015 peak, halted its decline with prices rising by 4.1 per cent in the three months to this September. Strong demand has also led to a recent upturn in sales.

Chinese cities such as Shanghai (up 23.4 per cent annually), Guangzhou (14.3 per cent) and Beijing (7.1 per cent) fared much better and dominate the top ten rankings for annual price growth, although local governments have enacted a range of measures recently to cool demand, suggesting a more muted outlook.

Seoul and Tokyo, for their part, did fairly well so far this year.

Overall, despite an average annual growth rate of 3.8 per cent, 18 of the 37 cities tracked by Knight Frank saw their rate of price growth slide compared with last quarter.

“From a global perspective, elections and referendums tend to provoke a wait-and-see’ approach in the minds of buyers and this has been the case both in terms of the UK’s Brexit vote in June and the forthcoming US presidential election,” says Kate Everett-Allen of Knight Frank’s International Residential Research unit.

For Asia, currency movements will be an important determinant of international demand in the top cities over the next 6 to 12 months, which is why the US election will have an impact on the property market either way.

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Reading Time: 2 minutes

Bangkok’s skyline with the newly opened MahaNakhon tower, a luxury residential development

Real estate consultancy Knight Frank in its latest research on prime residential property prices in tier-1 cities around the world, entitled Prime Global Cities Index, found that price growth has been slowing down in a number of regions, including ASEAN and some cities in East Asia.

Reading Time: 2 minutes

bangkk-mahanakhon-tower
Bangkok’s skyline with the newly opened MahaNakhon tower, a luxury residential development

Real estate consultancy Knight Frank in its latest research on prime residential property prices in tier-1 cities around the world, entitled Prime Global Cities Index, found that price growth has been slowing down in a number of regions, including ASEAN and some cities in East Asia.

Within ASEAN, price growth in the third quarter of 2016 was just 0.5 per cent in Singapore and 0.1 per cent in Jakarta and zero in Bangkok. In Kuala, price growth reversed to -0.6 per cent. All cities but Jakarta were given a negative outlook, Jakarta itself a flat forecast.

In the wider region, Hong Kong looks better. The special administrative region, where luxury residential prices are 4.7 per cent below their second quarter of 2015 peak, halted its decline with prices rising by 4.1 per cent in the three months to this September. Strong demand has also led to a recent upturn in sales.

Chinese cities such as Shanghai (up 23.4 per cent annually), Guangzhou (14.3 per cent) and Beijing (7.1 per cent) fared much better and dominate the top ten rankings for annual price growth, although local governments have enacted a range of measures recently to cool demand, suggesting a more muted outlook.

Seoul and Tokyo, for their part, did fairly well so far this year.

Overall, despite an average annual growth rate of 3.8 per cent, 18 of the 37 cities tracked by Knight Frank saw their rate of price growth slide compared with last quarter.

“From a global perspective, elections and referendums tend to provoke a wait-and-see’ approach in the minds of buyers and this has been the case both in terms of the UK’s Brexit vote in June and the forthcoming US presidential election,” says Kate Everett-Allen of Knight Frank’s International Residential Research unit.

For Asia, currency movements will be an important determinant of international demand in the top cities over the next 6 to 12 months, which is why the US election will have an impact on the property market either way.

pgci-q3-2016_tablepgci-q3-2016_fig2

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