Knight Frank’s Prime Global Rental Index provides a quarterly snapshot of trends in 15 luxury lettings markets across key world city markets.
Key Findings:
- Prime rents across Knight Frank’s global basket of luxury rental markets rose by 2.8% year-on-year in Q1 2026, down slightly from 3.0% in Q4 2025, confirming that the post-pandemic rental surge has eased into a more measured phase of growth.
- Sydney was the strongest-performing city globally, with prime rents increasing 10.6% annually and 5.3% over the quarter, highlighting strong demand and limited supply.
- New York (+7.4%) and Tokyo (+7.2%) ranked second and third respectively for annual rental growth, with Melbourne (+5.4%) and Hong Kong (+4.2%) completing the top five.
- Inflation-adjusted rental growth continues to weaken, with real annual rental growth slowing to 0.5%, down from 1.0% in Q4 2025, suggesting landlords are finding it harder to achieve above-inflation rent increases.
Liam Bailey, Global Head of Research at Knight Frank commented: “The post-Covid repricing of prime global rents has largely passed through, but the market has not moved into reverse. Growth is slower, more selective and increasingly dependent on local supply constraints. Markets with tight availability and resilient high-income demand are still seeing meaningful rental growth, while affordability pressures are capping performance elsewhere.”William Lau, Senior Director, Head of Residential Agency added, “Hong Kong’s prime residential leasing market continues to demonstrate resilience, with rents rising 4.2% year-on-year in Q1 2026, placing the city among the world’s top five fastest-growing prime rental markets. This performance is underpinned by sustained demand from high-net-worth individuals, expatriates and senior executives, coupled with a limited supply of quality residential stock. Looking ahead, market performance will continue to be driven by talent inflows, corporate leasing activity and supply dynamics, providing ongoing support to the prime residential rental sector.”