The maxim of ‘location, location, location’ matters equally as much when choosing a second home location as when choosing a primary residence, as the Savills Prime Residential Index: World Second Homes Locations tells us. We analysed 60 destinations worldwide, based on five categories: prime residential prices, the leisure and lifestyle offering, the quality of hotels and hospitality, connectivity and global reach.
The Côte d’Azur tops the index; a destination that first found favour with English visitors in the 19th century, when aristocrats chose to winter there. The Côte d’Azur offers natural landscapes, varied high-end lifestyle offerings, annual international events, from sport tournaments to film festivals, complemented by a wide range of property on offer.
Savills Prime Residential Index: World Second Home Locations
Top 10
Source: Savills Research
Monaco ranks second. Prime property prices here fell by 2% in the year to June 2023, yet they remain the highest in all 60 of the locations on the index. This, coupled with good connectivity and easy access via Nice airport, along with a calendar full of social and sporting events from the annual gala to Formula 1 all of which supports its position. Aspen sits third, the highest ranked ski destination in the index and one of the most sought after second home destinations in the United States. Fourth and fifth, respectively, are central Italian region of Tuscany, where prime property prices are relatively low, and the Balearic island of Mallorca, where prime prices rose by 15% in the year to June 2023.
The highest-ranked UK location in the index, in seventh place, is the Cotswolds, an Area of Outstanding Natural Beauty that also benefits from a wide variety of attractions and ease of access to London. The region saw a 2% increase in prime prices in the year to June 2023.
Performance and prospects
The pandemic-related bounce that was seen across the global property markets, but particularly in second home markets, is readily apparent in the prime residential second home location pricing. In the twelve months to June 2023, capital values across the retreat markets increased by an average of 7%, demonstrating the continued prioritisation of the home, and quality of life, in the wake of Covid-19 lockdowns.
However, this rate is lower than what many locations experienced during the pandemic, when many city residents moved to second home locations in search of greater space.
The highest priced and faster growing destinations tend to be space constrained or have limitations on the number of properties which can be built. Ski locations in particular stand out, with an average price growth of 15% between June 2022 and June 2023. In the years to come, islands, microstates, and fully built-out areas will likely continue to see price rises as demand increases from prime buyers.
Longer term, a shift in leisure habits could shape future demand. In Sweden, environmental concerns from the impact of air travel led to the rise of ‘flight shaming’; however, Swedes have traditionally holidayed closer to home with many second homes found in the areas surrounding Stockholm. If the no-fly movement gains traction in other countries, leisure locations with good rail connections, close to large centres of wealth generation are likely to benefit.
Read the full Savills Prime Residential Index – World Second Home Locations 2023 report here.
