Global cities experienced only modest growth in home values from April through June, as much of the world faced some form of economic lockdown, according to new data.
House prices in 150 urban centers rose by an average of 3.4% in the second quarter of 2020 compared to the same period last year, according to Knight Frank’s Global Residential Cities Index, published on Thursday. While it marked a very slight downtick from the 3.6% annual growth recorded in the first three months of the year, the massive economic disruption caused by the pandemic appears not to have had an immediate impact on city home prices.
Indeed, there were still pockets of extreme growth even in the face of uncertainty, particularly in Turkey, where astronomical price growth in three cities led the entire index. The Turkish port Izmir, the country’s third most populous city, saw home prices shoot up 28.1% in the year through June, followed by Ankara, the capital, with 26.4% growth and Istanbul, with 20.2% growth year-over-year.
A mixture of strong demand, fed by large population growth, and declining supply have helped prop prices. A weak lira has also helped draw foreign interest in Turkish real estate, particularly among buyers from Gulf countries, according to Knight Frank.
After Turkey, the Philippines capital of Manila; St. Petersburg, Russia; and Seoul all saw annual price growth over 15% in the second quarter.
Seoul and Manila were, however, outliers on a continent where price growth slowed in the second quarter of this year. Asian cities, on average, saw the lowest annual growth—under 3%—of any region in the second quarter.
Meanwhile, the number of markets with negative price growth expanded in the second quarter, likely reflecting the increased economic uncertainty.
Abu Dhabi and Dubai trailed the entire index with prices falling 8.3% and 6.6%, respectively. They were joined by a slew of Indian cities, including Delhi and Mumbai, with major annual price falls.
As for the world’s luxury hubs, Hong Kong—among the most expensive real estate market in the world—saw home prices slip 2.7% in the latest index. New York City, which experienced the worst coronavirus outbreak in the U.S. and a paralyzed housing market during the spring, saw prices rise 1.7% year-over-year.
Sweden, without a formal lockdown, recorded higher price growth than most other European cities. In Stockholm and the port city of Malmo, prices rose more than 6% in the year through June.