Madrid enters the Champions League of luxury housing

PUBLISHED ON

Septiembre 09, 2024

CATEGORY

Real Estate

Madrid is already the fifth most sought-after European destination for the wealthy to live.

Madrid is consolidating its position as a leading destination in the luxury real estate market. Proof of this is that the Spanish capital has entered the top 5 European cities preferred by millionaires to live.

Madrid's attractiveness is based on the high quality of life offered by the city with abundant green spaces and a warm climate, as well as its growing economic environment, which attracts professionals and entrepreneurs.

Access to education is another favorable point, in the opinion of the great heritages of countries such as the United States, Canada, the United Kingdom or China, having a variety of high quality educational institutions; as well as its strategic position and connectivity with other major European cities through its airport and high-speed train services. “Finally - but equally important - Madrid offers a rich cultural life, with access to some of the best restaurants in Europe and a vibrant social scene, making it an attractive place for those who value culture and leisure,” highlights the European Lifestyle Report 2024.

Salamanca neighborhood

In terms of the most sought-after locations, prime homebuyers in Madrid are interested in very exclusive properties, especially in neighborhoods such as Salamanca. “Confidence in a sustainable growth market, and with powerful fundamentals, is what is driving prime and super prime at this point in the cycle, not just interest rates. Above all, Madrid offers security, privacy and well-being, and this is even more important than the tax advantages. In addition, its cultural attractiveness, quality of life and growing reputation as a financial and business center hold unbeatable prospects as an investment destination. In fact, it is already home to 43% of the high net worth individuals living in Spain.

On the other hand, the world's wealth growth is increasingly mobile, with two in ten ultra high net worth individuals (UHNWIs) planning to apply for a second passport or a new nationality by 2024. In addition, 83% of those wishing to relocate prefer to live in a city for its economic and cultural opportunities.

Prices slow down

In terms of prices, the value of prime housing worldwide has slowed down as it closed the second quarter with an increase of 2.6%, compared to 4.1% in the first part of the year. This is shown in the Prime Global Cities Index report, which measures the performance of prime housing prices in 44 cities around the world over the past 12 months. “This slowdown reflects the fact that, without further stimulus in interest rate cuts, the rebound in market prices is running out of steam. All eyes are now on the central banks.”

Stockholm is the most improved capital city in terms of annual price growth in the second quarter (3.4%), followed by Lisbon (3%). For 2024 as a whole, Manila tops the rankings, with 26%. It is followed by Mumbai (13%) and Delhi (10.6%). In the United States, Los Angeles is the city where prices are growing the most (8.9%). By contrast, Dubai is the market where the cost of prime housing is slowing down the most, by 0.3% between March and June of this year, after rising by no less than 124% since the coronavirus pandemic.