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March 6, 2019updated 08 Mar 2019 1:23pm

These countries lead the way for global UHNWI growth

By Oliver Williams

The global UHNWI population is forecast to grow by 22% in the five years to 2023, meaning an extra 43,000 people will enter the wealth bracket defined with a net worth of over $30,000,000.

Knight Frank, a global property consultancy, which announced the findings on Wednesday, said the increase meant one new UHNWI created every hour for the next five years.

UNHWI growth: Countries with the largest UHNWI populations in 2019:

  1. USA 48,787
  2. Japan 18,951
  3. Germany 14,721
  4. UK 13,051
  5. China 10,549
  6. Canada 4,951
  7. Switzerland 4,944
  8. France 4,704
  9. Spain 4,310
  10. Italy 4,251

The US remains home of the largest number of UHNWIs. However, the strongest growth is in Asia, the report says: “it hosts eight of the top ten countries with the fastest growing UHNWI population”.

These countries include India, China, Philippines, Malaysia, Vietnam, Pakistan and Indonesia.

Countries with the fastest UHNWI growth

Knight Frank forecasts more UHNWIs are expected to emerge from India than China, for the first time in recent years. The country will see a 39% rise in the number of UHNWIs, to 2,697 by 2023.

Just last week, another UHNWI data provider, the Hurun Report, said as many as 213 Chinese tycoons lost their dollar billionaire status last year after poor market performance and the effect of the trade tensions.

In terms of regions, the slowest growth was expected in Africa, which will see a 20% increase in the number of UHNWIs over the next five years.

The top 30 countries for UHNWIs growth

Disclosure: Data for the Knight Frank Wealth Report is provided by WealthInsight which shares the same holding company as Private Banker International.

London leading

When it comes to cities, London reigns supreme as the world’s leading ‘wealth centre’. Knight Frank pulls a variety of metrics to rank wealth centres, including the number of HNWIs, volume of property investments and various lifestyle qualifiers. In all bar one – investments – London leads.

“Hard Brexit, no Brexit, Brexit-lite: whatever the outcome, London will remain the leading global wealth centre in 2019,” the report says.

Commenting in response to the Wealth Report, Darren Best, managing director of commercial property specialist Savoy Stewart, said, “It is really encouraging to see that, despite some pitfalls and perhaps a slowed pace, interest in London office investment is burning through, with notable interest from South Korea, Singapore and Israel”.

Richer but watchful

According to Knight Frank’s Attitudes Survey, a poll of 600 private bankers and wealth advisors, 64% of UHNWIs expect their wealth to increase over the next 12 months.

However, those anticipating a decrease in their wealth has risen from 7% last year to 12% this year. Their main concern? The political and economic environment in their home countries according to 70% of responders.

Gold is rising as a result. Asked about their asset allocations in 2019, 15% said they were increasing their position in gold, which is considered a safe asset during times of volatility. The figure was just 3% last year.

Taking to the bottle

Gold is not the only precious object UHNWIs are buying amidst uncertainty. The Knight Frank Luxury Investment Index increased by 9% in the last year. The Index tracks luxury investments such as art, classic cars, coins, watches and, for the first time this year, rare whiskey.

While coloured diamonds and stamps flatlined and jewellery fell by 5%, the value of rare whiskey boomed by 40% over the last 12 months. This was largely helped by the sale of a bottle of Macallan 1926 by Christie’s for $1.5 million.

Lord Andrew Hay, global head of residential at Knight Frank, told this morning’s audience at the report’s launch party in Claridges: “It was fastest growing asset we’ve seen last year”.

 

 

 

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