By Vidya Ram, Forbes.com

When a sumptuous two-bedroom apartment on St. Petersburg, Russia's Square of Arts first went on sale in October 2008, it was listed at 1.8 million euros (2.6 million U.S. dollars). At the start of August 2009, the price tag was cut to 1 million euros ($1.4 million)--and the property is remains replete with ornate balustrades, chandeliers and 24-hour security.

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"The St. Petersburg market is in a bad situation right now," says Alexander Belyaev, managing partner at Realtor Engel & Voelkers, St. Petersburg, who estimates prices have tumbled between 35% and 50% in the past year. Another property put on the market for 2.9 million euros ($4.1 million) sold for just 1.5 euros ($2 million), he says.

That seems to contradict headline figures for Russia, since Knight Frank's Global House Price Index says property prices rose 3.6% year-over-year. But in other countries too, nationwide data is covering up sharp dips in the property market as higher-end properties are brought down to the one-million-euro price point, from Buenos Aires to Hong Kong to Dubai to Mumbai.

A year ago, 1 million euros would have fetched a tiny one-bedroom flat near London's Trafalgar Square, but at this point in 2009, it'll get you a 1,400-square-foot, two-bedroom apartment in celebrity hotbed Hampstead. Even allowing for currency fluctuations, that's a big difference.

"We have seen a big shift in the prime markets in zone-one and zone-two regions, which were perhaps most dependent on bonus money," says Lucian Cook, head of residential research at British Realtor Savills, referring to London's central commuter zones. While some regions of the city, such as the central south west, have begun to see a bit of a recovery, he expects the fluctuations to continue over the next 12 months.

In New York, property prices around the 1-million-euro mark have fallen 20% to 30% between the third quarter of 2008 and the second quarter of 2009, while sales activity has halved, according to Jonathan Miller, chief executive of New York-based real estate consultancy Miller Samuel. There has been some pick-up since June, but mainly in the first-time-buyer category at lower price points. According to Knight Frank data, U.S. property prices fell 16.9% in the first quarter.

"This was a combination of pent-up demand from the lack of activity for the first half of the year coupled with historically low mortgage rates, while the Fed has done everything it can to get customers to enter the market with things like tax credits for first-time buyers," says Miller. A year ago, 1 million euros would have fetched a one-bedroom duplex on Central Park West; this year it will buy you a two-bedroom, 1,400-square-foot pad on Park Avenue.

It's a similar picture over on U.S.'s West Coast, where a stunning four-bedroom home on San Francisco's Steiner Street, one of the most photographed areas of the city, is on the market for 1 million euros. While the city was slow to feel the pain of the U.S. housing slump, property prices are now down 20% to 25%, says Jay Costello, president of local Realtor Hill & Co. "And I don't think we are yet at the bottom."

But price changes in the U.S. pale in comparison to the tremendous movements in Dubai. Between September 2008 and January 2009, prices fell 75%. And so far this year, high-end property prices have decline by as much as another 50%, says Jack Whisker of Dream Property Dubai.

There has been some recovery in demand for properties that have already been built, such as the Marina area, but a 1-million-euro budget in Dubai now has the buying power for a six-bedroom, 5,100-square-foot villa.

Perhaps it's not surprising that these market falls have brought out bargain hunters. Engel & Voelkers' Belyaev says he's seeing a rising number of Russians elsewhere living in Europe seeking out bargains in the center of St. Petersburg where they could spend a few weeks a year. "Those who have money right now could buy real bargains--the best real estate for the cheapest price."