Cooling measures are taking the heat out of expat property investment in cities across the globe.
Governments have introduced extra taxes to stop foreigners buying up prime residential property from Canada, across Britain and Europe to Hong Kong and other major Chinese cities in a bid to curb overheating house prices.
And in most places they seem to be working, according to the Knight Frank Prime Global Cities Index for the second quarter of 2017.
The latest figures for Canada property hot spot Toronto show house price growth of almost 21% for the year to the end of June – but this has slowed to 5.1% in the last quarter.
Chinese authorities have also put the brakes on property prices, and although Guangzhou still tops the table of 41 cities with 35.6% annual growth, the increase in prices slowed to 6.2% in the last quarter.
London’s falling
Shanghai also dropped from a 19.7% year-on-year change to just 6.2% in the second quarter.
Paris was the only other city to register a 6% or more price increase for the quarter, dropping from an annual change of 8.8%.
London, a favourite property investment destination for expats, has now fallen to 38th place, recording a 0.2% decrease against a –6.3% drop year-on-year.
The largest price drop was in St Petersburg, Russia, posting –5.8% for the quarter and –7.9% for the year, just ahead of Moscow in last place, with a –3.7% quarterly result against –11.8% for the year.
Ups and downs
“Overall, 28 of the 41 cities (68%) recorded flat or rising luxury prices over the 12-month period; a figure that has remain largely static in last two years. Perhaps more valuable an indicator is the market direction of each city,” said Knight Frank researcher Kate Everett-Allen.
“Cities in Asia, Russia and the Commonwealth of Independent States (CIS) account for ten of the 17 cities that have seen their rate of annual growth decline compared with last quarter.”
Overall, 23 cities showed house price increases, Rome remained at zero, while 17 posted price drops.
Besides Toronto, Seoul, South Korea in third was the other non-Chinese city in the top five with an annual increase of 19.9% and a quarterly result of 4.4%.
