An African city is included in a newly released list of real estate markets projected to overtake major global cities in terms of property price appreciation.
The list, prepared by Candy & Candy, Savills and Deutsche Asset & Wealth, included cities in Europe, Asia, Africa, Middle East and the Americas, both from developed and developing economies.
The basis for inclusion in the list, which excludes famous cities such as London, New York, Paris, Tokyo and Beijing, is the prime to secondary ratio of a 2-bedroom apartment that is considered the secondary home and another 2-bedroom flat considered the prime home.
The report, titled Candy GPS (global prime sector), stated that property investors are seeking real estate yields that they could tap by purchasing properties in cities not yet heavily invested into by wealth individuals.
Paul Tostevin, associate director of Savills World Research, explained, “Those looking for income-producing properties are more likely to find high and rising rental incomes in the places where capital values have not been driven by UHWI (ultra-high worth individuals) inward investment.”
Most of these are rising second-tier cities with the potential to exhibit strong residential property price growth and range from well-known to little-known areas.
Among the common characteristics of the 12 cities are the use of English as a first or second spoken language, the presence of industries considered new technology, nearness to green spaces or water and availability of cultural amenities.
Here are the dozen cities and their respective prime to secondary ratios
- Tel Aviv, Israel – 2.9
- Melbourne, Australia – 2.11
- Miami, USA – 3.27
- Chicago, USA – 2.8
- Dublin, Ireland – 2.67
- Panama City, Panama – 2.5
- Beirut, Lebanon – 2.78
- Istanbul, Turkey – 2.24
- Cape Town, South Africa – 3.36
- Jakarta, Indonesia – 2.89
- Lagos, Nigeria – 4.29
- Chennai, India – 4.0
Lagos is the capital city of Nigeria and is the most popular location for home searchers in Africa. It made up 37% of searches in Lamudi, followed by Casablanca in Morocco (32%), Nairobi, Kenya (19%) Marrakech in Morocco (5%) and Rabat also in Morocco (4%).
The five cities of London, New York, Hong Kong, Singapore and Moscow comprise 40% of the USD $2.2 trillion global ultra-high wealth real estate investment.