Big Apple is world’s hottest luxury property market

New York‘s luxury property market was on fire in 2014, with high-end home prices registering the biggest gains globally, according to Knight Frank.

The value of high-end residential property in the U.S. financial center soared 18.8 percent between December 2013 and December 2014, far outpacing the global average price growth of 2 percent, the real estate consultancy’s annual Wealth Report showed on Thursday.

“With New York number one in the Prime International Residential Index, it is clear that it has transformed itself again in the recent past, and as result, has broadened its appeal to the international investment community,” said Alistair Elliott, senior partner and group chairman of Knight Frank.

“It is impossible to predict the future, however, with the current confidence in the U.S. economy, the short-term prospects are extremely positive,” he said.

U.S. cities dominated the top end of the rankings, with four cities featuring in the top 10. By contrast, Asia, which had four markets in the top 10 in the previous year, had just one.

New York was followed by Aspen, Bali, Istanbul and Abu Dhabi, which saw gains of between 14.7 percent and 16 percent.

San Francisco, Dublin, Cape Town, Muscat and Los Angeles rounded out the top 10, with price advances between 13.2 percent and 14.3 percent.

“Asian growth has moderated for a variety of reasons. Macro-prudential tools, introduced to cool residential markets, continue to have an impact. This is evident most notably in the markets with ongoing weak growth such as Hong Kong and Singapore,” said Nicholas Holt, head of research for Asia Pacific at Knight Frank.

“Government policy has been deliberately aimed at limiting price rises through higher taxation and mortgage market intervention,” he said.

Beijing and Guangzhou, previously in the top 10, have now slipped to the middle of the Prime International Residential Index – which tracks the price performance of 100 of the world’s key luxury markets. Singapore, meanwhile, has fallen almost to the bottom of the charts.

Despite the slowdown in China’s economy, wealthy emigrants from the mainland continue to be a significant force in global luxury real estate market, said Holt.

Around 76,200 Chinese millionaires are estimated to have emigrated or acquired alternative citizenship in between 2003 and 2013.

Going forward, Mexico, Indonesia, Nigeria and Turkey will become major suppliers of ultra-high net worth individuals hungry to buy high-end international property,” Holt said.

“Indonesian buyers will become a much more serious force in Australia and the wider Asia-Pacific region in 2015.”