Knight Frank: Global luxury residential markets continued to grow through 2024

The global luxury residential market continued to grow in 2024, defying economic headwinds and uncertainties, according to Knight Frank's 2025 The Wealth Report. With global interest rates decreasing over the past year, prime residential prices saw a steady increase of 3.6%. Out of the 100 markets tracked by Knight Frank's Prime International Residential Index, 77 experienced positive annual price growth. Asian and Middle Eastern markets took the top spots in the ranking, showcasing the robust growth in these regions. Liam Bailey, the Global Head of Research at Knight Frank, emphasized the significant role of private wealth in driving the surge in house prices globally. The report highlighted a 4.4% increase in the number of individuals with assets exceeding $10 million worldwide, indicating a strong growth trend in private wealth. Africa notably saw a 4.7% growth in this category over the past year, contributing to the overall global story of economic prosperity. Bailey acknowledged the impact of declining interest rates on liquidity in prime global markets. He noted that the United States remains a dominant force in wealth creation, attracting investments from around the world. However, other regions like the Middle East, particularly Dubai and Saudi Arabia, have emerged as attractive destinations for property investment due to their growing markets and diverse opportunities. The report also shed light on the ongoing transfer of wealth from baby boomers to younger generations. As younger family members inherit substantial wealth, there is a gradual transition in the management of portfolios and assets. While some changes are expected in the way wealth is handled, Bailey suggested that the long-term approach to portfolio management might temper drastic shifts in investment strategies. In the realm of luxury collectibles, Bailey discussed the performance of assets such as art, whiskey, and wine. While the collectibles market experienced a downturn in recent years, with funds flowing into financial markets and cryptocurrencies, there are niche segments within the art market demonstrating resilience. Female artists, especially surrealists, have seen a surge in demand, indicating a growing interest in diversifying art collections globally. Looking ahead, Knight Frank's Wealth Report provides a comprehensive outlook on the evolving landscape of global wealth and luxury markets. Bailey's insights underscore the resilience of the luxury residential sector amid economic challenges and changing demographics, emphasizing the enduring appeal of prime real estate as a coveted asset class.