Wealth Blog | Luxury residential opportunists count rewards

Global luxury residential markets are always interesting. It really does indicate where the wealthy are hanging out, migrating to and moving away from. The never-ending search for safe haven investments keeps pushing prices up, in spite of stock market blips and financial crisis fallout. It seems you just need nerves of steel and the courage to jump in at the bottom. Whatever happened to the dreadful doom and gloom in the US property market only a few months back? Last week in New York all anyone could talk about was how it was simply too expensive to live in town any more. Formerly cheap arty areas like the lower East side are cheap and full of artists no more. Where the artists have gone is anyone’s guess but it’s wall to wall city suits now. New Yorkers are scathing about the bridge folks, those who have been hounded out of Manhattan to places like New Jersey by property prices, but that’s reality. With them have gone the Mom and Pop shops and rerstaurants, driven out by the escalating rents. New Yorkers are having exactly the same conversations as we are here in Hong Kong.

Meddling governments achieve little

Growing global wealth has kept governments active, trying to limit price growth and stop bubbles developing but their efforts seem cosmetic at best.  A certain strata is getting richer and is prowling the planet looking for real estate investments.

Knight Frank’s latest Wealth Report shows a polarised global market, with a third of the locations in their Prime International Residential Index showing prices rose during 2012, despite mixed economic fortunes.

But they found half of their reported locations showed negative growth, not surprisingly in Europe. Particularly in the second-home hubs, although even there, less greedy prices have begun to attract new investment.