Manila’s Luxury Homeowners See Some of the Biggest Price Gains Globally

Forget about Dubai and Miami, Manila is the new luxury real estate darling and now lays claim to the fastest-growing high-end property prices in the world, according to a new report from Knight Frank. 

Cities in U.S., meanwhile, mainly occupied the lower end of the ranking

More: Turks and Caicos Megamansion Sells for a Record $33.5 Million

In Manila, the capital of the Philippines, luxury home prices rose 21.2% in the year to September, more than any of the other 46 cities included in the analysis, which was released Wednesday in the U.K.

Manilla has a population of more than 13 million across its metropolitan area, according to 2020’s census. The stellar performance of its big-ticket home market is attributed to strong domestic and foreign investment, the real estate firm said. 

Dubai, with 15.9% annual growth, was knocked down to second in the ranking. The city’s luxury real estate market has been on a sharply upward trajectory since the start of the pandemic but those gains slowed during the third quarter, with prices rising just 0.7% between July and September. 

Shanghai, Mumbai and Madrid rounded out the top-five fastest-appreciating markets. 

Average price growth across all 46 cities ticked up 2.1% in the year to September, more than the annual gains recorded in both the first and second quarters, the report said. 

“The improvement in average annual house price growth will be welcomed by prime market homeowners but shouldn’t be overstated,” said Liam Bailey, global head of research at Knight Frank. “Higher rates mean we have moved into a world of lower asset price growth—and investors will need to work harder to identify opportunities for outperformance to secure target returns.”

While 67% of markets saw prices rise over the year, only 63% saw an increase over the quarter, “indicating lingering uncertainty, primarily due to the potential for further interest rate hikes,” the report said.

The U.S. dominated the lower end of the ranking. San Francisco experienced a 9.7% annual price drop—the worst annual performance of any of the cities. In New York prices fell 4%, while in Los Angeles values slumped 1.9%.