The prime residential costs across the 22 cities (on typical) are anticipated to stay static in 2020, ahead of increasing by two% in 2021, according to a report by Knight Frank.
The ‘Prime Global Forecast 2021’ report says the prime residential market place of Mumbai, even though anticipated to see a flat .% annual cost alter in 2021 (Dec 20 – Dec 21), is probably to witness a buoyancy in demand for the prime properties. Delhi’s prime residential market place has performed superior than Mumbai and Bengaluru in Prime Global Cities Index Q3 2020.
Shanghai and Cape Town lead the forecast for 2021 with annual cost development of five% forecast in 2021 whereas Buenos Aires is anticipated to be the weakest-performing worldwide city, with prime residential costs falling by -eight.% in the similar year.
Knight Frank’s analysis evaluation expects 20 of the 22 cities to see costs stay flat or enhance in 2021, a slight reversal of the trend noticed in 2020, exactly where analysts anticipate nine cities to finish the year with reduced costs.
Besides the forecast, Knight Frank, via its Prime Global Cities Index Q3 2020, has also shared a 12-month and three-month cost alter for the prime residential markets. The report tracks the movement in prime costs across 45 cities. A year ago, the index rose at a price of 1.1% per annum, climbing to 1.six% by the finish of September 2020.
Shishir Baijal, Chairman and Managing Director at Knight Frank India, mentioned, “With the modest price correction in the Indian real estate sector, post-lockdown, the luxury market has seen significant traction. Buyers are responding favourably to residential purchase across segments including luxury as sale prices have corrected in the last few quarters making investment in property attractive. It is also not surprising that those markets that are already witnessing an economic rebound have moved higher in the rankings in this quarter. In this period of uncertainty, the Knight Frank Prime Global Cities Index still registers a prime price growth across the globe despite the pandemic.”
Key observations for Prime India markets:
# Delhi’s prime residential market place performed superior than Mumbai and Bengaluru. Globally, the city ranked 27th with a .two% annual cost alter for the period Q3 2019 – Q3 2020 with a decline of .1% cost alter in Q3 2020 compared to the prior quarter.
# Mumbai ranked 33rd with -1.three% annual cost alter for the period Q3 2019 – Q3 2020. The city saw also saw a decline of .7% cost alter in Q3 2020 compared to Q2 2020.
# Bengaluru ranked 34th with a decline of 1.four% annual cost alter for the period Q3 2019 – Q3 2020. The city registered a cost decline of -1.five % in Q3 2020 compared to the prior quarter.
Kate Everett-Allen, head of international residential analysis at Knight Frank, mentioned, “From health to economics, 2020 saw the world upended. Our latest data, however, shows that prime property markets were largely resilient. As we look to 2021, clearly there are challenges ahead. Europe is currently in lockdown in some markets, and most fiscal stimulus measures are set to taper off in early 2021. The concern for investors is that rents are declining in several key cities; due in part to the absence of international students, but also due to a surge in supply as landlords switched from holiday lets to long-term rentals. Taxation will be a big theme next year too as all eyes will be on government plans to replenish public coffers. From proposed wealth tax changes (Spain, Canada) to higher capital gains taxes (US and UK), the tax landscape looks set to shift.”
Commenting on the report, sector specialists mentioned that it is undoubtedly a superior time for homebuyers to take the plunge.
Ram Raheja, Director, S Raheja Realty, mentioned, “With the prices of prime global residential markets expected to rise by 2% in 2021, it is certainly a good time for homebuyers to take the plunge. Narrowing it down to Mumbai, one of the most prime locations in India; with both demand and prices expected to rise, it is a great time to buy a house. The current stamp duty reduction until December 31 makes it more lucrative, especially for big ticket purchases. After witnessing volatility, people are now looking for reliability as a major factor and real estate is the most promising asset-class to cater to this need. Hence this trend will sustain and in fact further strengthen.”