The average rise was 5.5% in the year to June 2016 and of the 150 cities tracked, 114 recorded positive annual price growth and 31 of these saw price growth exceed double digits.

China leads the rankings with the rapidly-expanding technology hub of Shenzhen in front, though its growth has slowed from 63% in the last quarter to 47%. Due in part to Shenzhen’s slower rate of growth, the gap between the strongest and weakest performing city housing market has shrunk from 74 percentage points in March 2016 to 59 points in June.

Of the top 10 cities in the Index, six are in China (Shenzhen, Shanghai, Nanjing, Beijing, Guangzhou and Hangzhou) and their growth has been remarkably rapid. According to data from China’s National Bureau of Statistics the average annual rate of growth for the top ten performing Chinese cities equates to 22% in the year to June, a year earlier the comparable figure was -1.1% for the same ten cities.

A number of the municipal governments in China are now introducing a raft of stringent measures designed to cool the market at a local level and to dampen sales. These include limiting non-locals to single home purchases and tightening rules for local residents in relation to second home purchases.

In Europe, Budapest leads the rankings with prices there accelerating 24% on an annual basis, but cities in the UK, the Netherlands and Scandinavia are also well represented. Four of the continent’s top 10 performing cities are in the UK: Bristol, London Nottingham and Birmingham.

Cities in the negative portion of the index include Moscow (-11%) and Jaipur (-10%). Both cities occupy the bottom two rankings this quarter, and in both cases Knight Frank identifies their sluggish economies as having a direct impact on housing demand.

Other cities that have fallen down the list in the last quarter, include Istanbul (3rd to 9th), Stockholm (6th to 29th) and Auckland (8th to 15th).

Housing is a perennial 'big ticket' item in relocation, and the sharp differences in prices between cities and the market-cooling measures in China will undoubtedly trigger a re-evaluation of policy and budgets for global mobility professionals.

To read the full report from Knight Frank, click here

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