Tokyo ranked first in the world in terms of the rate of growth in luxury housing prices in the first quarter of 2026, according to Knight Frank’s Prime Global Cities Index.
Over the past 12 months, luxury housing in the Japanese capital has risen in price by 44.4%. However, compared to the previous quarter, prices fell by 8.6%, marking the weakest quarterly performance among the cities tracked.
Manila took second place, where the cost of premium housing rose by 19.9% year-over-year and by 3.3% quarter-over-quarter.
Dubai ranked third with year-over-year growth of 13%. However, prices in the emirate fell by 0.8% in the first quarter.
Next were Seoul with an 11.3% increase, Singapore with 9.8%, Mumbai with 8.2%, Nairobi with 7.1%, Perth with 6.2%, Bangalore with 5.2%, and Zurich with 4.8%.
Seoul showed the strongest quarterly performance, with luxury housing prices rising by 5.4% over three months. Prices rose by 5% in San Francisco, 3.3% in Manila, and 3% in Bangalore and Miami.
Asian cities took five of the top six spots in the ranking, reflecting stable demand for premium real estate from affluent local and international buyers.
Dubai remains the leader in the longer term as well. Over five years, from the first quarter of 2021 to the first quarter of 2026, prices for premium housing in the emirate rose by 180.7%. In Tokyo, the increase was 126.4%; in Manila, 91.8%; in Seoul, 71.5%; and in Miami, 64.4%.
Kyiv and other Ukrainian cities are not included in the study.
Tokyo, previously considered one of the world’s most expensive cities, has become one of the most affordable major cities among developed economies, according to a Deutsche Bank study.
Rent for a three-bedroom apartment in the Japanese capital is about a quarter of the cost of similar housing in New York. Buying an apartment costs about one-third as much as in Hong Kong or Seoul, and nearly half as much as in London.
Dinner for two in Tokyo costs less than in Warsaw or Prague, and is about three times cheaper than in Zurich and New York. Japan also turned out to be the cheapest of the markets surveyed for buying an iPhone, including taxes.
The main reason for the change in Tokyo’s international standing was the weakening of the yen. Since 2012, the Japanese currency has lost about 51% of its value against the dollar, while the cumulative increase in domestic prices was significantly lower.
As a result, the estimated price level in Japan based on purchasing power parity fell from 125 points in 2012 to approximately 60 points.
Japan has become more affordable for foreign tourists and those earning income in dollars or euros. However, for the local population, the weak yen means higher costs for imports and travel abroad.
