Hong Kong eclipses London as world's top luxury property market

Hong Kong eclipses London as world's top luxury property market
When it comes to luxury homes, Hong Kong has taken the crown as the world’s leading real estate market in 2016, overtaking London, according to a new report by Christie’s International Real Estate.

The city-state saw a record number of multi-million deals last year, as deep-pocketed Chinese continued to buy up luxury property in spite of heavy stamp duties.

Christie’s survey reveals that four out of ten homes that sold for over a hundred million dollars last year were in Hong Kong.

“It boiled down to the concentration of world wealth, and there is a significant concentration of billionaires in China. On the risk side of the equation, Hong Kong is more stable than other prime markets,” said Dan Conn, chief executive of Christie’s International Real Estate.

London, which topped the index for the previous four years, dropped to the second spot partially due to tax hikes as well as Brexit-related uncertainty, the report shows.

New York clinched third place, while Los Angeles and Singapore settled in fourth and fifth place.

A significant increase in markets like Hong Kong last year were set against “more turbulent waters witnessed in deep markets like the UK, which had to deal with an election, new taxes from a Conservative government, Brexit and yet another election,” according to Conn.

At the same time, Auckland, New Zealand was overtaken by Canada's Toronto as the hottest performing prime property market in theLuxury Thermometer ranking that measures the pace of growth. Toronto almost doubled sales of million-dollar-plus homes over the year.

“Overall, the global luxury markets remained healthy with moderated sales growth,” the head of Christie’s said.

He stressed that market shifts mostly reveal the concentration of global wealth, stability and the historic performance of real estate.

While the prime real estate is thriving, the market of more modestly priced homes is slowing down. Global sales of property for at least $1 million increased just a percent last year, down from an eight percent increase in 2015 and a 16 percent advance in 2014, the report shows.