Knight Frank: Prime Global Cities Index, Q2 2025

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Pia Arrieta DM Properties
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Knight Frank’s Prime Global Cities Index Q2 2025 tracks movements in prime residential prices across 46 key cities worldwide, offering valuable insights into global property trends. In Q2, the index recorded an average annual price growth of 2.3%, down from 3.5% in Q1, reflecting increased uncertainty around the timing and scale of interest rate cuts in major economies.

Out Now - Prime Global Cities Index - Q2 2025

 

Key Findings:

Average annual house price growth across our 46-city basket slowed to 2.3% in the second quarter of 2025, down from 3.5% in Q1. The deceleration reflects growing uncertainty over the timing and scale of interest rate cuts in key global economies, pulling the growth rate further
below the long-term average of 5.2%.

  • 2.3% average annual growth in prices across our 46-city basket.
  • -4.2% Turkey’s real annual price growth, despite 32.2% nominal growth
  • 75% proportion of our cities that saw positive house price growth over the past 12 months.
  • Seoul the city with the fastest rate of annual growth in Q2.
  • Tokyo - a notable growth market, with five-year growth of 120%.

While global prime price growth is moderating, Málaga province – home to Marbella and the Costa del Sol – continues to outperform, driven by sustained demand and limited supply.

In the second quarter of 2025, Málaga’s residential market continued to show strong performance, with Land Registry data reporting a 10.3% annual increase in overall home prices across the province. New-build prices rose by 6.3%, while resale properties surged by 11.9%. Within Málaga city, prices increased 7.6% year-on-year, outpacing both the Spanish national average and the 2.3% annual growth recorded in Knight Frank’s Prime Global Cities Index for the same period.

Liam Bailey, global head of research at Knight Frank, commented: "Prime markets are taking a collective breath. The recovery we have seen over recent quarters was aided by the expectation of lower borrowing costs, and with that timeline now pushed out, a cooling in price growth is inevitable. We're seeing a more fragmented market, with some European cities showing surprising strength while former high-flyers in Asia begin to level off.”

Marbella and the wider Costa del Sol, which fall within Málaga province, remain key drivers of this growth. Record demand from international buyers and limited supply continue to fuel Marbella’s position as one of Spain’s most sought-after residential markets. At the same time, Málaga city has evolved into a thriving urban hub, attracting both domestic and foreign clients for living, investment, and relocation.

Read the full report: Knight Frank Global House Price Index Q2 2025.

Pia Arrieta, 28 Aug 2025 - News

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