Home prices are rising across Europe. Luxury homes are no exception. World-class property prices are on the move in European cities. Annual price increase in more than half of the nearly 50 cities tracked by Knight Frank’'s 2026 Asset Report 2025’te %It exceeded 3’.
So, which cities are triggering the rise in world-class property prices across Europe? So how do European luxury markets compare to the rest of the world?
First-class properties are the most desirable and most expensive properties in a given location. Usually the first in terms of value of each market %5Identified as ’i. Primary markets often have a significant international bias in terms of buyer profile.
Prague saw the highest increase
Knight Frank’'s Prime International Housing Index tracks 100 cities worldwide, including 47’si in Europe’. Prague, the capital of ’, in 2025 %With an increase of 14.6, it recorded the strongest growth among European cities.
Méribel of ’ (France%9), Portugal’den Porto (%8.5) and Marbella of ’ (Spain)%8,1) also achieved strong gains; in each order %8 He went up on ’.
Courchevel 1850’de is another French ski resort. %A strong increase of 6.9’ was seen.
Italy’ Florence and Lake Como’nde respectively %6.7 and %An increase of 6.5 was recorded.
SwitzerlandGstaad in ’ (%5.5), ItalyRome in ’ (%5,5) and Quinta do Lago in ’ (Portugal)%5,2) %5Reported increases over ’.
The top 10 European cities in the index have one thing in common: Ski resorts in the Alps, golf resorts in Portugal’ and romantic cultural cities are at the top of the list.
Europe’'s biggest fall occurred in London’
Not all European cities made a profit. London, 2025’te world-class property prices %With a fall of 4.7, he recorded the sharpest drop.
In the report, “London is evolving as changes to tax rules for wealthy residents lower budgets and encourage some to consider renting instead of buying, ” said.
Ibiza, Jersey and Lausanne in ’ %From 1 to %There have been modest declines between the two.
Other European capitals include Madrid (%5, from Oslo (%4,2 and Berlin (%3.4 It has made strong gains. the Lisbon (Lisbon%2,7), Dublin (%2,3), Vienna (%1.3, from Paris (%1,3) and Bucharest’te (%0,4, the growth was more moderate. the Stockholm ’ %While there was a slight decrease of 0.7’, prices in Edinburgh’ were flat.
Lifestyle and holiday destinations winners
Lifestyle and holiday destinations EuropeWinners by far in ’. Alpine ski resorts and Mediterranean sun destinations are at the top of the ranking. Italian cities also stand out in groups.
Big financial capital tells a different story. London, Stockholm, Paris and Milan resorts lag far behind their markets.
Tokyo is a global contrarian
Tokyo stands out as a global outlier. JapanPrices for premium real estate in the capital city of ’ 2025’te %It's up 58.5. Tokyo’'s newly built housing market is on the rise due to scarcity, low interest rates and strong domestic demand from the Asia-Pacific ’, the report said.
Dubai %2nd place with an increase of 25.1’; But the data predates the US-Israeli ’ attack on Iran’ and Tehran’'s subsequent reaction to the Gulf states.
Manila and Seoul were also in the top five, and each %It increased by about 15-20.
Prague is in the top five, making it the top-ranked European city worldwide.
Liam Bailey, editor of The Wealth Report’, said that first-class residential property in many markets has moved away from the wider residential sector, backed by the power of wealth creation.
While mainstream markets are subject to broader economic pressures, the speed at which wealth is created helps keep demand for luxury properties more resilient, even against recent fluctuations in debt costs.“
The biggest losses in China and Canada’da
China’in Guangzhou’su recorded the biggest drop; first-class real estate prices %It's down 12.2. the Shenzhen (Shenzhen%7,2), Shanghai (%5) and Beijing (%4.9) is also among the steepest global declines, indicating a broad slowdown in Chinese cities.
CanadaApproximately in each of ’'s provinces of Toronto and Vancouver %7’ descents were seen.
Tourist-friendly markets such as Portugal, Croatia and Spain recorded even stronger increases, according to Eurostat’, while EU home prices increased by 2025 year-on-year in the last quarter of ’. %It's up 5.5.
