Prime rental growth across the basket of 16 cities slowed in the final quarter of 2024, with rents increasing 2.2% over 12 months – the slowest rate in more than three years.
This is according to Knight Frank’s global rental index.
Tokyo takes the lead on the ranking with annual rental growth at 6% – the city has seen strong demand growth set against a stubbornly slow supply response.
Zurich and Melbourne round out the top three cities for growth.
A post-Covid repricing saw prime city rents climb 28% from the end of 2020, with cities like London and New York experiencing growth of well over 50%.
Three markets saw rents fall throughout 2024: Toronto, Auckland and Singapore.
Since early 2021, Auckland has experienced modest growth, with a 9.6% rise, whereas Singapore and Toronto both saw strong growth of 40.1% and 28.9% respectively.
Liam Bailey, global head of research at Knight Frank, comments: “The upward repricing of prime global residential rents has worked its way through the system in most major markets.
“With wage growth and affordability stretched, we expect rental growth to remain positive but to sit below trend this year.
“Over the longer term, we are likely to see a return to stronger growth as demand requirements continue to outpace the supply response.”
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