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SG Bangkok prime property prices rise second fastest globally

Property Here - Monday, April 29, 2013

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By Andrew Batt

Prices of prime luxury property in Bangkok rose 26.1 percent in the first quarter of the year - the second highest rise of the 29 cities tracked in Knight Frank’s Prime Global Cities Index report.

Jakarta – with a 38.1 percent rise – led the world with Miami (21.1 percent) in third place. Prime property is defined as the top five percent of the mainstream housing market.

Globally, the average price of luxury homes in the world’s key cities fell by 0.4 percent in the first quarter of 2013 although the annual rate remained positive at 3.6 percent.

Kate Everett-Allen, International Residential Research at Knight Frank, said: “The measures aimed at cooling residential price growth in Jakarta and Bangkok have been less stringent than those applied across many neighbouring Asian cities, allowing new middle class wealth to fuel demand and push prime prices higher.”

Knight Frank noted that a typical prime property is now worth 21.3 percent more than it was in Q2 2009 when the Prime Global Cities Index hit its post-Lehman low. Eight cities recorded double-digit price growth in the year to March including stellar performances by the European cities of St. Petersburg and Monaco.

The price of luxury homes in Monaco increased by 10 percent in the first three months of 2013 as international interest swelled and the supply of apartments, particularly above €10 million (S$16.15 million), proved limited.

Tokyo, recording a 17.9 percent fall in prime prices, was the weakest-performing city in the year to March 2012. However, after nearly 15 years of deflation, the Bank of Japan has announced radical monetary-easing measures, and as a result business sentiment as well as demand for prime property is now strengthening.

Unlike Japan, the governments of China, Hong Kong, Malaysia and Singapore face the opposite challenge; trying to restrain growth.

 

Andrew Batt, International Group Editor of PropertyGuru, wrote this story. To contact him about this or other stories email andrew@allproperty.com.sg