Prime property investors should target Miami – Knight Frank

High net worth investors should target Miami in Florida if Knight Frank’s prediction is to be believed.

According to the estate agency firm prime prices in Miami will rise by 10% next year, making it the best-performing city featured in 2022 Knight Frank’s Prime Global Forecast.

Florida’s low tax regime, Miami’s competitive prices and the appeal of coastal living during the crisis has already boosted demand, as prime price growth is expected to total 22% in 2021.

Since the start of the pandemic, Palm Beach County alone has seen 35 sales above $30 million, 20 above $40 million and two above $100 million.

Sydney is the second best prime investment location according to Knight Frank, as prices are expected to increase by 9% in 2022.

The reopening of borders, the return of investors and the growing appetite amongst domestic buyers for second homes on Australian soil, heightened by recent lockdowns and travel bans, is expected to result in price growth accelerating.

Kate Everett-Allen, head of international residential research at Knight Frank said: “Since the start of the pandemic we’ve monitored the performance of cities closely and the story is an evolving one.

“The narrative has pivoted from “cities are dead” to “smaller, secondary cities are king” and now “metropolises are back”.

“Behemoths like New York and London look to be awakening from their slumber with the pace of prime sales quickening and annual prime price growth moving into positive territory for the first time in three and six years respectively.”

Record low inventory levels and strong demand for large family homes set against a backdrop of low mortgage rates will lead to growth in Los Angeles of around 8% in 2022. Auckland (7%) and London (7%) complete the top five markets in the Knight Frank forecast.

For Auckland, 7% represents a marked slowdown in price growth as the government takes steps to rein in speculative activity.

For London, it will represent the city’s strongest rate of growth for eight years. An end to lockdowns, a reopening of travel, the winding up of the stamp duty holiday and the absence of political turmoil over Brexit will see a normalisation of market conditions.

In addition, sizeable discounts of 20%-30% exist for Euro and US-denominated buyers taking price and currency shifts into account since the EU Referendum in June 2016.

In Hong Kong, prime price growth is expected to moderate from 8% in 2021 to 5% in 2022. The economic slowdown on the Chinese mainland, along with a slump in the Hang Seng, are constraining factors but luxury prices remain at an all-time high and an influx of purchasing power from the Chinese mainland is expected once the border reopens.

In contrast to Hong Kong, Singapore is expected to see prime price growth strengthen year-on-year reaching 5% in 2022. The limited inventory of large luxury homes in the Core Central Region coupled with the release of pent-up demand once travel measures ease will see sales activity and prices accelerate.

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