The global luxury real estate market closed 2025 with strong momentum in high-value transactions despite a slight slowdown in annual growth, as major cities showed mixed performance due to tax policies and shifting investor preferences.
According to a Knight Frank report, 555 homes priced above $10 million were sold across 12 key cities, totaling $10.3 billion, with an average transaction value of $18.6 million. This trend reflects growing interest in larger, tax-efficient, and stable property assets.
For the full year, total sales reached 2,164 transactions worth $40.5 billion, marking the second-best performance since 2021 despite challenges such as higher financing costs and geopolitical uncertainty. The company’s report highlighted that liquidity remains abundant, although buyers have become more selective in their investments.
Dubai emerged as one of the leading markets, recording 143 deals in the final quarter worth $2.5 billion, supported by global wealth inflows and the launch of new developments. Hong Kong followed with 81 transactions totaling $1.57 billion.
Meanwhile, activity declined in New York and Los Angeles due to limited supply. Sydney registered a surge in deal volume, while transactions fell in Singapore, London, and selected areas of Miami and Palm Beach.
Over the course of the year, Dubai led global sales with 500 transactions, surpassing London by threefold. Hong Kong and New York maintained upward momentum, whereas London slipped to fifth place as a result of fiscal policy changes.
Looking ahead to 2026, interest rates, tax policies, and global wealth movements are expected to remain key drivers of the luxury property market. Buyer focus is increasingly shifting toward stability and regulatory clarity, outweighing lifestyle considerations alone.
