Luxury home prices to grow 1.6% in 2025

However, this increase is lower than the growth seen last year.

The cost of prime residential properties is projected to continue growing this year, expanding 1.6% across 30 cities, according to Savills World Research.

However, Savills noted in its latest World Cities Index that this projection is lower than the 2.2% seen in 2024.

“With 2024 dubbed the ‘year of elections’, 2025 looks to be a year in which these new governments start to make changes, from taxes to legislation to international affairs, each change has the potential for effects on prime residential property markets,” said Kelcie Sellers, associate director, Savills World Research.

In recent years, Savills said prime buyers worldwide are prioritising lifestyle when purchasing residential property. The latest index ranked Dubai, Sydney, and Madrid at the top of the list, and are projected to see growth between +4% to 9.9% this year.

“Dubai, a perennial leader for capital value appreciation, is forecast to see the strongest growth in 2025 with anticipated prime price growth of +8% to 9.9% during the year. A market with growth supported by deliveries of new supply, capital values increased in the emirate by 6.8% in 2024,” Savills said.