Economic volatility across many asset classes is generally supportive of prime property prices in global cities.
Manhattan's luxury market provides a good example. While the S&P 500 fell 19% in 2022, and estimates suggest crypto plummeted 50%, luxury homes in New York registered 2.7% average growth, despite the Federal Reserve embarking on its fastest pace of rate hikes since the 1980s.
Cash buyers account for about eight in ten new home purchases in Manhattan, better insulating the market from rate hikes relative to the wider housing market, where median sales prices of existing homes slid in February for the first time since 2012.
We expect to see growth of 2% in 2023, higher than the city’s 10-year average performance of 1.1% (see chart). You can read more in Knight Frank’s Q2 New York Insight, out now.