Why Nairobi Has Been Ranked Above London & New York in Wealth Report
In 2023, upscale residences in Nairobi saw a noteworthy price increase of 2.5%, surpassing the growth rates observed in well-known markets like London and New York.
In the latest Wealth Report for 2024 unveiled by Knight Frank, Nairobi secured the 52nd spot in terms of its growth rate. This report was made public on Wednesday, March 6th.
Significantly, the Prime International Residential Index (PIRI) noted a 2.1 percent decrease in London and a 2.0 percent decrease in New York for comparable home prices.
“Now in its 17th year, the Knight Frank Prime International Residential Index tracks movements in luxury prices across the world’s top residential markets.
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“The index, compiled using data from our research teams around the world, covers major financial centers, gateway cities, and second-home hotspots – both coastal and rural – as well as leading luxury ski resorts,” Knight Frank explained its ranking.
In the meantime, Manila, Philippines, and Dubai saw the most significant price increases, with growth rates of 26.3% and 15.9%, respectively.
The recent increase in prices within the Kenyan market highlights the market’s resilience and suggests a strong demand for Nairobi among the global super-rich.
Significantly, the Knight Frank Wealth Report focuses on investments made by individuals with a net worth exceeding Ksh143 million.
“Yet at the start of 2023, economists were expecting a much weaker outcome. Stock markets were headed for more pain, inflation was veering out of control and the pandemic-fuelled property boom was set to end in tears as borrowing costs hit 15-year highs in some markets. Right? Wrong,” read the report in Part.
London and New York: The Election Factor
The recent drop in the London and New York markets is said to be caused by government policies and upcoming elections. The US is slated to have its election in November 2024, while the UK General Elections are scheduled for January 2025.
“A Labour Party victory in the UK general election is expected to end the non-dom tax regime, increase stamp duty for overseas buyers, and potentially lead to changes to inheritance tax rules,” the report explained.
Nevertheless, it pointed out that the drop in prices might appeal to wealthy individuals looking to purchase residences.
Billionaire Interest
As noted in the report, the attention of wealthy individuals in 2024 will be shaped by the easing of property taxation and regulatory measures.
The allure of properties will also play a role in the decisions of billionaires regarding where to acquire their next lavish residences.
“Auckland leads our prime price forecast, while Sydney is the frontrunner in our rental forecast for 2024. Prime price growth across
the 25 cities tracked are forecast to reach 2.5%, up from 1.7% in 2023 with Mumbai, Dubai, Madrid, and Sydney joining Auckland to complete the top five,” read the report in part.
Why Nairobi Has Been Ranked Above London & New York in Wealth Report