Study Reveals Top Cities with Rapid Real Estate Price Changes

A new study by Deluxe Holiday Homes analyzed and ranked the top ten cities leading in real estate price change. The data collection included rent prices for 1-bedroom apartments in both city centers and outside city centers for three years, alongside apartment purchase prices per square meter for the same period.

To determine the cities with the highest growth, the study focused on the percentage change in both rent and property prices between 2021-2022 and 2022-2023. The cities with the highest overall percentage change in both rent and property prices were ranked the highest, indicating markets with strong potential for investment or economic growth.

Tokyo, Japan ranks first in real estate price growth, with rents and property prices cumulatively increasing by 12.53%. It saw the sharpest increase in average property prices in two years, reaching up to 28.98, while simultaneously experiencing the most significant drop in rent prices, declining by -3.92%. This duality makes Tokyo the most dynamic and turbulent real estate market among all the cities analyzed.

Moscow, Russia ranks second, with real estate prices growing by 12.22%. The city experienced the highest rent increase among the cities listed, with a dramatic rise of 23.78%, while property prices saw a modest increase of 0.65%. The significant rental market growth suggests a growing demand for rental properties in the city despite slower activity in property sales.

Cape Town, South Africa ranks third, with 23.14% growth across rent and property prices. Rent rose by 11.40%, and property prices climbed by 11.74%, indicating strong market expansion and increasing demand for both rental and owned properties.

Beijing, China ranks fourth with a total real estate price increase of 20.61%. In two years, the rent here increased by 11.09% and property prices rose by 9.52%. This suggests a strong rental market alongside steady property price growth, making it a prime location for real estate investment.

Madrid, Spain ranks fifth. Its overall real estate price growth in two years is recorded at 12.24%. The city experienced a significant rise in property prices, up by 14.04%, though rents declined by 1.80%. The disparity between rent and purchase price growth indicates a market shift toward buying over renting, likely due to rising affordability concerns.

Hong Kong, China ranks sixth, experiencing a total growth of 8.42% in rent and property prices cumulatively. Interestingly, the city had a decline in rent prices of 1.44%, while property prices rose by 9.87%. Despite challenges in the rental market, the city has seen steady growth in property prices, reflecting a recovery in property demand.

Melbourne, Australia ranks seventh. The overall growth in Melbourne’s real estate market stands at 7.82%. The city saw a sharp rise in rents at 13.00%, although property prices fell by 5.18%, reflecting a shift in demand from buying to renting. This change is indicative of shifting market dynamics, likely influenced by economic uncertainty and higher interest rates.

Los Angeles, United States, ranks eighth, with an overall increase in real estate prices standing at 7.55%, which shows that it has a less turbulent market compared to other cities. Rent increased by 7.42%, while property prices grew by just 0.13%. This slower growth suggests a cooling off in the market after the pandemic boom.

Delhi, India ranks ninth, with an overall price increase of 5.83%. There was a slight decline in rent prices of 0.90%, while property prices increased by 6.73%. This marks a more conservative market, with property sales on the rise but rental growth remaining relatively flat.

Rio de Janeiro, Brazil, ranks tenth, with a real estate price growth of 5.06%. The rents increased here by 7.25%, and property prices decreased by 2.19%. The overall decrease in property prices indicates a slowing market for property purchases while rental demand remains stable.

A spokesperson from Deluxe Holiday Homes commented on the study: “Global real estate markets are experiencing varied growth patterns, with some cities seeing strong gains in both rent and property prices, while others are witnessing a shift in demand between the two sectors. In markets where rental prices are outpacing property value increases, there’s a clear demand for flexible living options, while regions with slower growth in property prices may indicate a shift toward more cautious investment strategies or rising affordability challenges for buyers.”