Prime residential markets in North America have remained resilient, despite higher borrowing costs and slightly weaker consumer sentiment, supported by growth in the tech sector.
The North American cities in the index saw respectable capital value growth over the first half of the year, averaging 2.1% across the four markets, as mortgage rates eased and the labour market remained stable. This is accompanied by a modest average rental growth of 1.2%. However, sentiment in the United States is still mixed as high prices, elevated rates and housing costs weigh on sentiment.
San Francisco bounces back, New York stays steady
San Francisco was the region's strongest performer, with capital values rising 4.8% and rents increasing 3.7% over H1 2026. After lagging during much of the post-pandemic period, the city has benefited from renewed momentum in the technology sector, having emerged as the global leader in AI development. This is attracting both talent and capital back to the market.
New York recorded steady, broad-based growth, with capital values increasing 2.4% and rents rising 2.1%. The city continues to command the highest prime residential prices in North America, at approximately $2,700 per sq ft, supported by its status as a global financial and cultural centre.
San Francisco's rebound reflects the growing influence of artificial intelligence on global wealth creation and housing demand.
Mixed markets
Performance was more mixed elsewhere. Los Angeles saw capital values rise 1.5%, but rents fell -1.2% over the same period. The city recorded the region's highest yield at 6.2%, despite the sharpest yield compression in the index (-15.2 bps), reflecting capital value growth that has outpaced rental growth.
Miami was the only North American market to record a decline in capital values, falling -0.3% during H1 2026. Rental growth has also softened, with rents down -5.0% year-on-year despite a modest increase over the latest six-month period. After being one of the strongest beneficiaries of pandemic-era migration trends, the market now appears to be entering a period of normalisation as relocation-driven demand moderates.
Overall, North America's four index cities recorded some of the most stable yield profiles globally, with yields ranging from 3.6% to 6.2%, underlining the region's relatively resilient market fundamentals.
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