Luxury Rents Around the World Rose Faster Than Sales Prices 2023

Luxury residential rents remained strong globally in 2023, outperforming capital values in 28 of the 30 cities tracked in the Savills World Cities Index, according to a report from the British real estate company on Wednesday.

On average, luxury rents increased by 5.1% last year, compared to the average home price growth of 2.2%.

“In the face of economic uncertainty, the prime residential rental market proved resilient in 2023,” said Kelcie Sellers, associate at Savills World Research. “Continuing a trend from the past year, prime rental value growth outpaced capital values, largely driven by a lack of stock in global prime markets and increased levels of demand from individuals and families who would look to purchase a property, but are holding off until the economic and interest rate situations stabilise.”

Lisbon was by far the leader in rental growth, with luxury rents increasing by an average of 39% over the year and by 22% in just the second half of 2023, according to the report.

“Lisbon has seen an influx of people moving to the city, attracted to its climate, the quality of life on offer and strong business environment. But some have been more reluctant to enter the purchase market in Lisbon due to rising house prices and increasing interest rates,” Sellers said. “While the supply of houses in the rental market has not kept pace with demand, leading to a rise in rental prices throughout Portugal, it remains comparatively priced compared to other rental markets in Europe and will likely continue to attract new renters and investors over the coming year.”

Singapore led the Asia-Pacific region, with its rental growth at 12.3%, though that was down from 32.3% in 2022. Hong Kong also saw luxury rents increase, jumping by 5.9%, as high deposit requirements, increased interest rates and an influx of buyers from Mainland China drove would-be buyers to the rental market, according to Savills.

As for the year ahead, a slight increase in luxury rents is expected across the 30 global cities, though the price growth may be less than usual.

“Looking at the year ahead, prime rental prices are forecast to record a slight increase for the 30 cities covered in the World Cities index, as would-be prime buyers continue to turn to rental markets, but this growth will likely remain below the historic average,” Sellers said.

Savills predicts that Amsterdam will lead this year’s rental growth index, with a forecasted increase of 6% to 7.9%, as the city has seen a spike in demand in tandem with limited supply and increased regulations on the private rented sector.

Listing of the Day

Location: Downtown Brooklyn, New York

Price: $16.75 million

Boasting 360-degree panoramic views across New York City, this new 92nd-floor penthouse is the highest residence in Brooklyn.

The full-floor apartment stands atop the new Brooklyn Tower, which encompasses 143 condos and 398 rentals in the heart of downtown Brooklyn, said Katie Sachsenmaier, senior sales director, Corcoran Sunshine Marketing Group.

The condos begin on the 53rd floor, and the penthouses begin on the 88th floor. This one, Penthouse 92, is the only full-floor penthouse.

“The building is coming into its own now,” she said. “It feels very busy when you step into the lobby.”

Developed by Silverstein Properties, the building at 85 Fleet Street rises from the historic Dime Savings Bank building, according to a news release.

It was designed by SHoP Architects with interiors curated by Gachot Studios, and it is the borough’s only super tall skyscraper.

Penthouse 92 features custom interiors by Brooklyn-based Susan Clark of design firm Radnor, Sachsenmaier said. “Her selections have made it really beautiful. It feels very warm and inviting.”

Architectural details include 12-foot ceilings, European white oak floors in a custom honey stain, mahogany millwork, bronze detailing and floor-to-ceiling windows.

The eat-in kitchen features Absolute Black stone countertops, an island with seating, oil-rubbed bronze Waterworks fixtures and integrated Miele appliances, according to the listing.

The primary en suite bathroom showcases large-format Honed Breccia Capraia marble. There is also a separate laundry room as well as a wet bar and a butler’s pantry.

The views are spectacular, Sachsenmaier said. “If you’re standing in the living room, you take in the Statue of Liberty and all the way up through Midtown. On a clear day, you can see the planes take off at LaGuardia (Airport).”

Penthouse 92 features custom interiors by Brooklyn-based Susan Clark of Radnor.
Photo: Sean Hemmerle

Moving around the apartment, you see south over the harbor and then north and east over the whole city, she said.

From the front door, “you’re immediately greeted with the expansive living room and the view,” she said. “It’s really the first thing you see.”

The primary suite features a dressing room, multiple walk-in closets, two bathrooms (one with a cedar sauna) and southwest-facing windows, Sachsenmaier said. “You get those really beautiful harbour views.

The amenities will be ready by the end of summer, she said. A Life Time club will occupy the entire sixth and seventh floors, and an outdoor pool deck wraps around the dome of the bank building.

Stats

The 5,891-square-foot home has four bedrooms, five full bathrooms and one partial bathroom.

Amenities   

Residents will have access to over 100,000 square feet of exclusive indoor and outdoor leisure spaces.

Fitness company Life Time will manage an array of amenities that include a 75-foot indoor lap pool, outdoor pools, a poolside lounge and atrium, a billiards room, a library lounge, a conference room, a theatre with a wet bar, a children’s playground and playroom and limited off-site parking.

The Sky Park offers an open-air loggia with a basketball court, foosball, a playground and a dog run.

An outdoor pool deck wraps around the dome of the Dime Savings Bank building.
Photo: Gabriel Saunders

Neighbourhood Notes   

Downtown Brooklyn is at the centre of a number of neighbourhoods, including Fort Greene, Cobble Hill, Boerum Hill and Brooklyn Heights. The tower has access to 13 subway lines, 11 commuter trains, the city’s ferry network and 22 Citi Bike stations.

“You can walk to Fort Greene Park in less than 10 minutes,” and Dekalb Market Hall, which has a Trader Joe’s, a Target and a food hall, is “right next door,” Sachsenmaier said.

Agent: Katie Sachsenmaier, senior sales director, Corcoran Sunshine Marketing Group

Luxury Rents Around the World Rose Faster Than Sales Prices 2023

The new Brooklyn Tower, a mix of luxury condos and rentals, rises from the historic Dime Savings Bank building.