Real Estate

Lisbon Leads Global Luxury Home Market Surge with 4.2% Growth in First Half of 2024

14 Sep 2024 min reading

In a standout performance, Lisbon has emerged as the fastest-growing market for luxury homes in the first half of 2024, according to a recent report from property firm Savills. The Portuguese capital experienced a remarkable 4.2% increase in high-end home prices, outpacing twenty-nine other prime property markets globally.
The report highlights that southern European city, along with those in the Middle East, have shown robust growth in their luxury real estate sectors. Following Lisbon, Amsterdam, Madrid, and Athens also recorded impressive gains, each with capital value increases above 3%. Dubai completed the top five, registering a 2.9% rise.
A significant factor contributing to the surge in southern Europe, including Lisbon, is a shortage of supply. This scarcity, coupled with the influx of American buyers drawn by a strong dollar and the appealing lifestyle of the region, has spurred demand. “American buyers have become a key prospective buyer base,” noted Savills, emphasizing their influence on the market.
In stark contrast, the luxury real estate market in the United States has been grappling with challenges. Elevated interest rates have suppressed demand in the sector, leading to a drop in luxury residential prices in three out of the four U.S. cities included in the study. (“AFFLUENT HOME BUYERS ARE DRIVING UP PRICES IN SOUTHERN EUROPEAN CITIES ...”) San Francisco was the only exception, experiencing a modest growth of 0.7%. Los Angeles faced the steepest decline, with luxury home prices dropping by approximately 4%.
Despite these regional disparities, the global luxury property market has shown resilience. Across all thirty cities analyzed, prime residential property prices averaged a growth of 0.8%, surpassing the anticipated annual growth of 0.6%. This positive trend reflects a sustained confidence in high-end real estate as an asset class, with 60% of the cities recording positive capital growth.
Looking forward, Savills projects an average capital value growth of 0.5% for the second half of the year, which would bring the total growth for 2024 to 1.3%. European cities, particularly Amsterdam, Lisbon, and Barcelona, are expected to continue driving this trend, with forecasted growth rates between 2% and 3.9% due to ongoing supply-demand imbalances in the market.
The report underscores the dynamism of the global luxury property market, highlighting Lisbon´s role as a leading hub in this space. As demand for high-end homes remains robust, particularly in Europe, investors and buyers alike are keeping a close watch on these trends.

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