LONDON and New York are still the top destinations for the world’s ultra-rich to live and invest in — but
LONDON and New York are still the top destinations for the world’s ultra-rich to live and invest in — but Asian cities are fast catching up, according to Knight Frank’s seventh annual Wealth Report key findings.
The global number of High-Net-Worth Individuals (HNWIs is defined as someone with $30 million or more in net assets) increased by almost 8,700, or five per cent, in 2012. Their number is set to increase by another 50 per cent in the coming decade, according to forecasts prepared for Knight Frank’s report.
The fastest growth in wealth creation over the next 10 years will be in Asia and Latin America.
London and New York are currently the top destinations in the world for the super-rich, and will remain so until 2023, according Knight Frank’s survey of wealth advisers, whose 15,000 clients have assets worth US $1 trillion.
The 2012 results of Knight Frank’s index — which tracks the performance of luxury property prices across 80 global destinations — shows Jakarta and Bali recorded the highest growth. Monaco is the most expensive location to buy a home: a luxury residence costs from $5,350 to $5,920 per square foot.
Next on the shopping list for the super-rich, after houses, comes classic cars. These have enjoyed the biggest uplift in value over 10 years (395 per cent), compared with other key collectables, such as fine wine and artwork.
The total number of super-rich individuals increased globally by five per cent in 2012, pushing an extra 8,700 people into the ultra-high net worth bracket.
The total wealth of HNWIs increased by $566bn to $26 trillion, an increase of two per cent year-on-year. Over the next 10 years another 95,000 individuals are set to break the $30m barrier in terms of personal wealth, and while Asia and Latin America will see the largest growth in the number of ultra-wealthy individuals, North America will still have the highest total number of HNWIs in 2022.
Liam Bailey, global head of residential research at Knight Frank, said: “The largest concentration of wealth is currently based in the established centres of North America and Europe, but there is set to be rapid growth in Asia, Latin America and the Middle East. In the next decade we will see the biggest increase in ultra-wealthy individuals in cities such as Sao Paulo, Beijing, and Mumbai.
“According to a survey of advisers with 15,000 ultra-wealthy clients, London and New York are still the most important destinations in the world. In 10 years’ time they will still lead the way, but key Asian cities will have moved further up the list.”
The growing influence of Asian wealth creation is shown in the results of the Wealth Report’s Prime International Residential Index (PIRI) which tracks the value of luxury residential prices in 80 prime global locations in 2012.
Price growth was strongest in Jakarta and Bali, with luxury property values rising by 38 per cent and 20 per cent respectively, boosted by a growing middle class in Indonesia.
The Chinese cities of Guangzhou and Shanghai also saw double-digit growth in the value of prime property, while the sheer weight of Chinese wealth pouring into Hong Kong resulted in an annual price increase of 8.7 per cent, despite the Government cooling measures which limited the potential for similar increases in Beijing.
Mr Bailey said: “Wealth creation has not been dented by the global economy slowing, nor has this affected the demand for prime property as the search for safe haven investments has continued. These factors will likely drive prime values higher in the short to medium term as HNWIs look to invest in tangible assets such as a prime property in the major global cities.”