Global housing market recovers

Global real estate market — countries leading in price growth and key trends

The global real estate market continues to show impressive growth rates amid economic recovery from the pandemic. According to Knight Frank research published as part of the Global House Price Index, in 2024 the average global growth in house prices was 3.3% year-on-year, which indicates an obvious stabilization of the market. However, the changes affected countries differently: while some showed moderate growth, in a number of countries the growth was rapid. Let's look at the countries leading in real estate price growth, analyze the key factors influencing the market dynamics, and discuss the prospects for the development of the sector in 2025. In addition, special attention will be paid to the elite real estate segment, where record growth rates are observed.

TOP 10 countries by housing price growth in 2024

Knight Frank has compiled a rating of countries where housing has risen in price the most. This index takes into account data in 56 countries, analyzing the change in property prices in nominal terms, without taking into account inflation adjustments. Here is the full list of leaders:

1. Turkey (+46.4%) — remains the undisputed leader. High inflation and economic instability motivate investors to invest in real estate as a more stable asset. Activity in international markets also supports demand.
2. Poland (+18.0%) — the country shows significant growth due to improved infrastructure, an increase in the number of jobs and strong demand for housing in megacities, especially in Warsaw and Krakow.
3. Bulgaria (+15.1%) — continues to develop the real estate sector, based on a favorable geographical location, an influx of migrants and an increase in tourist flow.
4. Czech Republic (+14.5%) — a stable economy and the expansion of credit programs played a key role for the Czech Republic. The large cities of Prague and Brno are especially popular.
5. Portugal (+14.3%) — is in demand among migrants and tourists. The cities of Lisbon and Porto lead in the number of transactions.
6. Thailand (+14.0%) — high interest in investments from abroad explains the significant growth in the domestic market.
7. Greece (+13.7%) — after the economic crisis, real estate prices are gradually increasing, which makes it attractive for European investors.
8. Georgia (+13.3%) — effective tax regimes and a loyal attitude towards foreign buyers create demand for local housing.
9. Mexico (+13.0%) — resort and overpopulated regions continue to develop in the country, where real estate prices are increasing.
10. India (+12.5%) — rapid infrastructure development and demographic growth support the construction sector.

Key trends in the global real estate market

In many countries, government policy instruments, low interest rates and demand for real estate from foreign investors remain the main drivers of price increases. It has been noted that intangible factors such as the attractiveness of the region for living, migration flows and availability of credit play a significant role. Key trends include:

1. Global growth — in the second quarter of 2024, there was an increase in prices of 1.9% over three months (April-June), which exceeded the pre-pandemic growth rate of 1.1% for the same period.
2. Regional differences — strong price growth was recorded in Europe in the eastern part (Poland, Czech Republic), which is associated with the development of infrastructure. In Asia, Thailand and India are the leaders, and in Latin America — Mexico.
3. Inflation effect — countries with high inflation, such as Turkey, show the highest nominal growth. However, in real terms (taking into account inflation), the situation is significantly different: significant declines are recorded in the same regions.
4. Urbanization and migration — large cities and megalopolises continue to attract population, which increases the demand for housing. Migration flows, both domestic and international, also stimulate price growth in popular regions.
5. Mortgage availability — lower interest rates and the expansion of government mortgage subsidy programs make home purchases more affordable for the population, which supports demand and prices for real estate.

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Records in the luxury real estate segment

A separate study by Knight Frank showed that the cost of luxury housing in major cities is also showing steady growth. For example, Seoul recorded an 18.4% increase in prices over the year, while Tokyo showed an exceptional quarterly increase of 10.6%. Factors affecting the premium segment:

1. Strictly limited supply of luxury properties.
2. Growing interest in high-end properties from wealthy international buyers.
3. Weakening inflation in developed economies, which supports stable demand for expensive assets.
4. Prestige and exclusivity of the locations where luxury properties are located.

In addition to Seoul and Tokyo, significant growth in luxury property prices is observed in Hong Kong, Singapore, London, New York and Paris. These megacities remain centers of attraction for wealthy buyers from all over the world, which ensures stable demand for exclusive properties.

Real Estate Market Development Forecasts in 2025

Current forecasts suggest that in 2025, moderate growth in real estate prices will continue in most regions, although the pace may vary due to macroeconomic factors.

• Russia — in Moscow, St. Petersburg and Sochi, analysts predict an increase in the cost of luxury properties by 7-13%. This is due to the limitation of new supply and increased interest from foreign buyers.
• Europe — prices are expected to stabilize in most European countries. However, in regions with active economic development and population influx, such as the capitals of Eastern European countries, growth may continue at a level of 5-7% per year.
• Asia — price dynamics in Asian countries will be uneven. Fast-growing economies such as India and Vietnam may show double-digit growth rates, while developed countries (Japan, South Korea) are expected to see a moderate increase of 3-5%.
• America — In the US and Canada, price growth is expected to slow to 2-4% per year due to a gradual increase in interest rates and market saturation. However, the premium segment in the largest cities will remain stable due to demand from international investors.

In conclusion, we note that the global real estate market is demonstrating recovery and growth after the pandemic period. In many countries, housing prices continue to increase, especially in the luxury real estate segment. The key growth factors are improving economic conditions, increased availability of mortgage loans, and steady demand from domestic and foreign buyers. Despite the overall positive trend, price dynamics will be uneven in different regions. Countries with fast-growing economies and active urbanization are likely to show the highest growth rates, while developed markets will face a moderate increase in prices. In any case, real estate investments remain an attractive tool for preserving and increasing capital in the long term. When choosing specific properties, it is important to consider local market characteristics, economic trends and individual preferences.