Property prices have increased by more than 10% in eight Chinese cities, with Chongqing in the lead as the top riser for both the mainstream (+ 58.9%) and the prime property (+48.5%) market.
The city in southwest China, which boasts an urban population of more than 8 million people, is just one of the 13 out of the 35 locations monitored by Savills World Research to have registered significant growth in mainstream property prices. Nine out of those 13 are Chinese cities. According to Savills Research, the way Chinese cities are aggressively dominating global ranking for house price growth:
“reflects huge demand from a growing and increasingly affluent population with a very high savings ratio and few choices of other assets into which to invest their cash”.
Only two European cities – Amsterdam and Dublin – made the top 10 for mainstream properties alongside seven mainland Chinese cities, with an increase of 20.9% and 12.3% respectively. Mainstream values have risen in Vancouver as well, with an increase of 16% compared to last year which earned the city a place in the top 10.
London holds the 26th position in the ranking for mainstream properties prices, with a modest increase of just 2.3%. As for prime properties, that is to say, “the most desirable, and normally most expensive, property in a defined location” according to Knight Frank Research, the ranking was also dominated by Chinese cities, with the top four recording a growth of at least 25%.
Alongside Chongqing, Tianjin, Wuhan, Hangzhou and Guangzhou, Amsterdam, Dublin and Vancouver also made the top 10, together with Tokyo and San Francisco. The latter is the only US city to be featured among the first ten, showing an increase in the value of prime properties of 12.3%.
London is among the fallers for prime properties price growth, together with Stockholm, Moscow and New York. The UK capital, where the prime price per square foot is US$1,770 (£1,287), holds the 29th position, registering a decrease of -3,3% compared to 2016. While Johannesburg is the least expensive city, with a mere US$70 (£51) for both mainstream and prime properties, Hong Kong is the most expensive location in which to buy. Both standard and high-end properties there are significantly more expensive than elsewhere, at a price of US$1,430 (£1,040) and US$4,000 (£2,909) for square foot respectively.
If compared to Chinese cities in the ranking, the gap in property prices between them and the autonomous territory seems even wider. Mainstream values in Chongqing, for instance, are just US$170 (£124) per square foot, a very reasonable price compared to the mainstream average of US$1,430 (£1,040) in Hong Kong. Beijing is a special case. Unlike other cities in mainland China, the capital hasn’t registered any substantial shift in mainstream and high-end property prices, with an increase of less than 10% in both markets. So in Shanghai, where the value of prime properties decreased by -5.7%, although mainstream properties have registered a rise of 10.7%.