Spain stands out in the latest report published by Knight Frank.
According to 'The Wealth Report', the annual analysis of luxury housing conducted by the consultancy firm, Spain is the second destination in the world that attracts more international capital for prime residential, only beaten by France. Third on the list is Italy, followed by the United Kingdom, Greece, Switzerland, Portugal, Croatia, Ireland and Germany.
Within the Spanish market, Madrid is the city of choice. In this year's edition, the capital is among the top 20 cities in the world and the fifth "most exclusive" city in Europe, as $1 million can buy 106 m2 of residential property.
The European ranking is topped by Monaco, where only 17 m2 can be bought for the same amount, followed by London, Paris and Berlin. As for the world ranking, Monaco is also in the number one spot, followed by Hong Kong, New York and Singapore. Madrid, in this case, ranks 17th after Dubai.
In 2022, prices in the Spanish capital rose 6% (to close to €3,000/m2, the highest since 2011), less than other cities such as Marbella and Barcelona (which increased almost 7% in both cases). Looking ahead to this year, Knight Frank's forecasts point to further growth of 4% by 2023. These figures place the Spanish capital sixth among the cities with the highest growth rates.
"The growth experienced by prime residential prices in the capital has been the most significant since 2018, which confirms that the market is in a good situation, and is resilient to situations of economic uncertainty such as the current one," said Knight Frank's director of Residential in Spain, Carlos Zamora. The document also states that "a large part of Spain's appeal is due to its capital, Madrid".
Internationally, Dubai remains at the top of the Knight Frank Prime International Residential Index (PIRI 100) and consolidates its status as a global centre for individuals with assets of more than $30 million after recording a price increase of 44.2% in 2022. The other top five cities where high-end properties rose the most over the past year are Aspen (27.6%), Riyadh (25%), Tokyo (22.8%) and Miami (21.6%).
Of the 100 markets included in PIRI, which analyses price performance in 100 cities, sun and ski areas, 85 recorded positive or flat growth in 2022.
Coastal and rural locations in sunnier climates recorded an average growth of 8.4%, slightly ahead of ski resorts, which rose by 8.3% on average, outshining their 2021 record. Meanwhile, the slowest price growth was seen in major urban markets, where prices rose, on average, half as much as in coastal and rural areas (4.2%).
The markets with the highest price growth during the pandemic are among those where prices fell the most during 2022: Wellington (-24%); Auckland (-19%), Stockholm (-8%), Vancouver (-7%); and Seoul (-5%).
The report also shows that the private sector has become the largest investor in traditionally institutional products in terms of profitability, while art has become the most profitable alternative luxury investment worldwide.