The growth of luxury home prices in Vancouver, Shanghai and key Australian cities has been significantly higher than the other cities tracked by Knight Frank.

As prices in prime central London grew at the slowest rate since 2009, Vancouver once again boasted the highest growth worldwide in the year to March 2016, according to Knight Frank’s Prime Global Cities Index.

Vancouver led the rankings for the fourth quarter in a row as supply shortages pushed prime prices in the city up by 26 per cent over the year. Shanghai, Sydney and Melbourne also recorded double-digit annual price growth, landing second, third and fourth place respectively. The 20 per cent year-on-year price growth in Shanghai was attributed to record-low interest rates and cheap finance, although recently tightened mortgage lending rules are expected to lead to more modest growth in the second quarter.

Australasia was the world’s strongest-performing region of the year. Despite the introduction of a new fee for foreign buyers, the region saw prices grow by an average of 12 per cent.

Notably, the gap between this top tier and the remaining cities has widened. Cape Town, for example, came in fifth place with a 6.9 per cent year-on-year price growth, following Melbourne, which logged a 12.1 per cent growth.

In prime central London, prices increased by just 0.8 per cent in the year to March, the lowest figure since October 2009, when the market readjusted with a 3.2 per cent decline following the Lehman Brothers collapse. The city slipped to 23rd place in the latest rankings following the introduction of an extra 3 percentage points of stamp duty tax for buy-to-let investors and second-home buyers. Prime prices across the 35 cities tracked rose on average by 3.6 per cent.

“New regulation in the form of measures to improve transparency, new taxes or fees for foreign buyers are increasing in number. However, the impact on the market of such measures is largely dependent on market fundamentals and where each market is in relation to its property market cycle,” said Kate Everett-Allen, partner, residential research at Knight Frank.