Price growth in Europe’s prime real estate markets — categorized as the top 5% of the market in value terms — has been among the highest in the world in the past year, according to Knight Frank.

In the past year, Europe’s prime real estate market has grown 5.6% amid continued demand, according to the research. Meanwhile, rental returns in the region’s most in-demand vacation destinations continue to rise.

“For second homeowners, Europe’s cities offer culture, connectivity and a good quality of life, whilst for investors they offer strong tenant occupancy and relatively low purchase costs,” Kate Everett-Allen, head of international residential research at Knight Frank, told CNBC.

The growth comes as investors search for safe-haven assets and income-generating investments as inflation soars — with interest extending across the Atlantic. Berlin, Germany has seen the strongest price growth in the year to June 2022, with high-end properties appreciating 12.6% on average.

The annual uptick puts the German capital’s growth rate well ahead that of other global cities like New York (7.3%), Hong Kong (3.1%) and London (2.5%). Elsewhere, property price appreciation has been strong this year across the high-end real estate markets of Edinburgh (11.2%), Dublin (10.2%), Zurich (10.2%) and Paris (8.9%).