Prime residential forecast: What did we get right, and wrong in 2022 - and what lies ahead?

In the interest of full disclosure, we look back at what we got right – and wrong – in 2022.

Written By:

Kate Everett-Allen, Knight Frank

29 Nov 2022

1 minute to read

Categories: Property Sector Residential Sales Publication The Wealth Report Archive Topic Forecast World Regions Global

Twelve months ago, 2022 was due to be ‘the year of the cooling measure’ as governments looked to rein in phenomenal pandemic-induced price growth. Fast forward a year, and central banks are doing their job for them as an era of cheap debt comes to a close and buyer sentiment weakens.

Bullseye

Although we’ve yet to hit year-end our research teams have estimated annual price growth for 2022. Take Dubai out of the equation and we got within two percentage points for 14 of the 25 cities (56%) in 2022.

Could do better

We plead extenuating circumstances for Dubai – few predicted the extent to which its comparative value came under the spotlight during and since the pandemic. Vancouver, Seoul and Auckland also wrongfooted us. Foreign buyer bans, and unexpected rate hikes leading to a sudden drop off in sales, eluded our crystal ball.

Biggest changes

Of the 25 cities, 11 now expect to see weaker price growth in 2023 than predicted just six months ago, while the price forecast for ten cities remains unchanged.

Despite the mounting economic headwinds, four cities are predicting stronger price growth in 2023 than previously anticipated. The outlook for Zurich, Vancouver, Paris and Singapore has strengthened either due to a dearth of supply, policy shifts or because a weak currency is helping to attract foreign demand