The always eagerly-awaited Knight Frank/Citi Bank Wealth Report has now arrived and, says Anne Porter Properties MD Lanice Steward, it contains more fascinating (and more really encouraging) data than ever before.
The report reveals that global economic problems have failed to curb the rise in the numbers of ultra-wealthy individuals. There are now 63 000 people worldwide with US$100-million or more in assets and the number of centa-millionaires has increased by 29 percent since 2006. What is more, all the predictions indicate that the number of high net worth individuals (HNWIs) will continue to rise.
How does this impact on the property sector?
"Contrary to what many people in the US predicted," said Steward, "the Wealth Report shows that for these HNWIs property continues to be the most favoured asset class, accounting for approximately 31 percent of all their assets, an increase of some three percent on last year."
However, said Steward, in today’s economies a global shift in capital continues to be strongly evident: investment continues to move east and to Africa. This, she said, confirms Knight Frank’s prediction that in the next 40 years the leaders in national GDP growth and in improving per capita income will be Nigeria, India, Iraq, Bangladesh, Vietnam, The Philippines, Mongolia, Indonesia and Egypt. Annual growth predictions in these areas, she said, are all between 6.4 percent and 8.5 percent for the next decade.
Despite this, said Steward, the traditional prime Western properties (most in the big cities) continue to attract top investors, including many Middle Eastern and Oriental people.
"The Wealth Report shows that central London, central New York, Monaco, Paris, Berlin and Geneva are still able to attract buyers from a worldwide net and the proportion of Oriental and Middle Eastern purchases continues to rise year-by-year. In such less publicised asset classes as vineyards, art and vintage cars, the same buying patterns are also increasingly seen."
Asked why China does not feature on the Knight Frank high growth list, Steward said that, after a phenomenal ten year growth splurge, Knight Frank sees China as heading for a less heated five percent to six percent annual growth. However, they rate it as the world’s second largest economy and see it holding this position until 2050 (and beyond). By 2050, Knight Frank predicts that China will be ranked number three in the world’s economies, with India holding the top spot, Indonesia at number four and Brazil in the fifth position.
"These predictions may seem way out to certain people, but we have to remind them that the economists quoted here are among the most reputable in the world," said Steward.
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