Former Soviet cities will lead the growth in the residential property market in 2012, according to a new report
The Prime Global Forecasts Q4 2011 by estate agents Knight Frank predicts that three of the seven fastest growing cities this year will be from the former Soviet Bloc.
Moscow and St Petersburg in Russia, as well as Kiev in the Ukraine, are all expected to see residential prices rise by between 5 per cent and 20 per cent over the next 12 months.
They will be joined, according to the survey, by Bangkok, Beijing, Paris and Nairobi.
But three of the recent powerhouse economies from the East – Shanghai, Hong Kong and Mumbai – are forecast to see falls of up to 10 per cent in residential property prices.
Knight Frank head of residential research Liam Bailey told AJ: ‘The Russian economy is doing well and the country is benefiting from strong oil prices. There is also an undersupply of housing.
‘These markets are very interesting for architects at the moment.’
He added that some countries in Asia were taking action to slow the incredibly high levels of growth they had seen over the past few years.
‘Some cities in Asia have seen price growth of up to 70 per cent,’ he said. ‘The governments are now trying to control this with measures such as stamp duty hikes and embargoes on buying multiple properties.
‘We are beginning to see price falls. However, in the long run, the demand for accommodation in Asia will remain massive, and the markets will stay strong.’
London, Rome, New York and Monaco are expected to see stable or slightly rising prices over 2012.
Sydney, Singapore, Ho Chi Minh and Hanoi are expected to see drops of less than 5 per cent over the next 12 months.