City markets in the frame as Fashion Week returns to London

City living is the season’s must-have as Fashion Week returns, with urban house price growth rising at its fastest rate for almost 17 years in the 12 months to Q3 2021, buoyed by the return to the office.

With the biannual Fashion Week visiting the world’s fashion capitals over the next month (and the London event opening today 18 February), we looked at which city is the top performer for mainstream house price growth.

While all the fashion capitals have seen growth, New York has retained its pole position with an uplift of 15.8% in the 12 months to Q3 2021. This compares with growth of 5.5% in Paris, 2.8% in London and 2.6% in Milan in the same period.

New York’s renaissance comes after a period that saw Americans shift their focus to suburban and commuter-belt property markets following the onset of the global pandemic.

It has also seen rents in Manhattan climbing by 23% in January compared to a year ago, according to Douglas Elliman, as the repopulation of New York continues apace.

While it is still not business as normal when it comes to international buyers in Prime Central London (PCL), momentum is building.

High demand and tight supply in PCL contributed to average price growth of 1.5% in the year to January 2022, which was the highest annual rate since August 2015. In prime outer London, average prices increased by 3.5% in the same period, which was the highest annual growth rate since June 2015.

Rental values in London are also 5% up on their pre-pandemic level as demand soars.

Outside of the capital, the percentage of sales in UK towns and cities was 40% in 2021 at Knight Frank, compared with a ten-year average of 37.3%, underlining how city living has bounced back as the world’s economies have reopened.

Asked in December what were the most important factors in choosing where to live since the pandemic, 51% of respondents to our UK survey said proximity to amenities such as restaurants, pubs, shops and entertainment was now more important. In May 2020 during the first national lockdown this figure was just 16%.

• The Q4 2021 edition of the Global Residential Cities Index, which tracks the mainstream price performance of 150 cities globally, will be published later this month.

Photo by Flaunter on Unsplash