Prices in key cities around the world are rising at their slowest rate since the third quarter of 2015, up by 4% in the 12 months to March 2018, down from 6.4% a year ago, the latest index shows.

The Indian city of Surat leads the annual rankings with a rise of 22% over the 12 month period, followed by Izmir in Turkey with a rise of 16.5%, Hong Kong up 15.6% and Vancouver up 15.4%.

The global residential cities index from Knight Frank also shows that prices rose by 14.9% in Berlin, by 14.8% in Rotterdam, by 14.4% in Budapest, by 14.1% in Hobart, Australia, and by 12.9% in Seattle, which is the top performance in the United States.

At the other end of the scale prices fell by 7.2% in Abu Dhabi, by 7.1% in Turin, by 6.6% in Genoa, by 6.5% in Darwin, by 6.1% in Moscow, by 4.9% in Rio de Janeiro and in Oslo, by 4.8% in Delhi and Dubai, and by 4.5% in Chennai.

The index report points out that while a year ago 12 cities exceed 20% growth per annum, this quarter only one city was in this category and this growth in the Indian city of Surat is largely due to an inordinately low base in the first quarter of 2017, caused by the unprecedented demonetisation of high value currency in the country.

Overall, the data shows that Europe’s upward trajectory continues. Eleven of the top 20 cities ranked by annual growth are in Europe with growth of 14.9% in Berlin, 14.8% in Rotterdam, 14.4% in Budapest, 12% in Edinburgh, 11.8% in Reykjavik, 11.7% in Porto and 11.3% in Sofia.

A lack of supply has boosted prices in Seattle with growth of 12.9% with San Francisco recording growth of 11.2% and Los Angeles up 8.1%. In the US, despite three rate rises in the year to March 2018 average prices across the 15 cities included in the index increased by 6.8% over the 12 month period.

The comparable figure for the UK’s eight cities is 4.9% with Edinburgh out in front and Aberdeen the weakest performer with pries down 2% while London has also seen negative growth with prices down by 0.6%.

Southern Europe is increasingly polarised. Whilst Italian cities are well-represented at the foot of the table, Spanish and Portuguese cities are registering stronger growth. Porto, Malaga and Madrid all sit high in the rankings with annual growth of 11.7%, 10.4% and 10.3% respectively.

The report also reveals that divergent markets are evident not just at a regional level but at a country level as well. The 10 countries with the largest gap between their strongest and weakest performing city is synonymous with a list of the world’s largest economies as all 10 occupy a seat at the G20. India leads the list with a gap of 27% points between Surat and Delhi.

‘The increased use of macro prudential measures to curb price inflation along with escalating affordability constraints account for the index’s weaker performance,’ said Kate Everett-Allen, head of international residential research at Knight Frank.

Prices in Key Global Cities Down to Slowest Growth Rate Since 2015 by Property Wire