Knight Frank Launches "The Wealth Report 2018 (12th Edition)"

Published on 2018-05-14

Chinese Mainland expects to see the strongest growth in ultra-wealthy population

  • World’s ultra-wealthy population increased by 10% in 2017 – taking the global population to 129,730, with a combined worth of US$26.4 trillion.
  • Asia surpasses Europe as key hub for ultra-wealthy individuals
  • Chinese Mainland expects to see the strongest growth in ultra-wealthy population between 2017 and 2022. China to contribute nearly half of growth of Asian ultra-wealthy individuals over next five years
  • Hong Kong and Singapore still bastions for the affluent

09 May 2018, Shanghai – Knight Frank, the leading independent global property consultancy, has today launched the Chinese version of 12th edition of The Wealth Report.  The report tracks the growing super-rich population globally along with a deeper analysis of 52 countries. The number of ultra-wealthy individuals – those with US$50m or more in net assets – rose by 10% in 2017, equivalent to 11,630 individuals, taking the global population to 129,730, according to data provided by Wealth-X for The Wealth Report. The global economy is booming ahead, lifting GDP, stock and property markets across the board. It must be noted that currency fluctuations also played a role, as the wealth data is recorded in US dollars.

Wealth distribution – Regional level

Noteworthy mostly for the inevitability of its arrival, Asia has finally overtaken Europe in absolute numbers of ultra-wealthy individuals. While Europe managed a very respectable growth of 10% in the category, matching the global average, its mature market was no match for the dynamism of Asia, which saw a 15% bump in its ranks. As of the end of 2017, Asia boasted 35,880 ultra-wealthy individuals compared to 35,180 in Europe. All eyes now move hungrily across the Atlantic to North America, which retains the number one spot.  But with growth of only 5% from 2016 to 2017, its status as the hub of the ultra-wealthy could be under threat. Australasia has managed a strong bounce back from negative territory in 2016, posting a respectable 9% growth but with a population still below where it was in 2012.

Regional Wealth Distribution

 Regional Wealth Distribution

Source: Wealth-X, The Wealth Report 2018 (Pg 14-15)

Wealth distribution – Asian growth

Growth within Asia over the next five years is looking very optimistic in both relative and absolute terms, led, as is so often the case, by China, which is forecast to contribute a whopping 47% of the growth of Asia’s nearly 20,000 new ultra-wealthy individuals. Second behind only Japan’s 9,960 ultra-wealthy individuals in 2017, China, with 8,800 is going to add as many again to its ranks, and then some: with growth of 104% over the next five years, the exclusive club of the ultra-wealthy is set to become considerably less exclusive.

Japan, finally recovering from its Lost Decades, is forecast to grow its ultra-wealthy by a significant 51%, the highest of any large, developed country. In Asia, Japan will contribute 26% of the new ultra-wealthy by 2022.

From an admittedly small base, the Philippines is in a very strong position going forward: after a less than exciting 2016-2017 period, it is now seen as the second-best place to be as far as growth in the ultra-wealthy is concerned: at 84% it is behind only China. Because of its low base, though, it will only contribute 1% of the region’s overall growth between 2017 and 2022.

In third position, Indian wealth is expected to charge ahead over the next five years after a solid but slightly disappointing 2017, narrowing in on 5,000 ultra-wealthy individuals, a growth of 71%. Indonesia and Malaysia occupy the 5th and 6th places at 66% and 65% growth, respectively.

Country level wealth distribution of ultra-wealthy (US$50m+) – Top 15 Countries

Country level wealth distribution of ultra-wealthy (US$50M+) - Top 15 Countries
Source: Wealth-X

Nicholas Holt, Asia Pacific Head of Research, Knight Frank, says, “2017 was a relatively strong year for growth in Asia-Pacific, which has been reflected in the growth in wealthy individuals across the region. Despite global headwinds including a rising interest rate environment, the continued rebalancing of the Chinese economy and tensions around trade, the region is set for further growth in 2018, with wealth increasingly being accumulated through new sources of growth including technology related industries.”

*Growth of ultra-wealthy (US$50m+) in Asia from 2017 to 2022 (Absolute growth; Percentage growth)

Wealth distribution – per capita perspective across Asia Pacific

Growth of ultra-wealthy (US50M+) in Asia from 2017 to 2022 (Absolute growth; Percentage growth)

Source: Wealth-X, Knight Frank Research

While Hong Kong and Singapore are not forecast to see absolute growth in wealthy individuals on the scale that we will see in Asia’s three largest economies: China, Japan and India – when looking at wealth concentrations, they still lead the way.

Analysing the number of ultra-wealthy individuals per 100,000 population, Hong Kong with 70 and Singapore with 25 are placed second and fourth globally respectively; Monaco helms the top position at 129 per 100,000 with Switzerland in third position at 44.

Ultra-wealthy individuals (US$50m+) per 100,000 population across Asia Pacific

Ultra wealthy individuals (US$50m+) per 100,000 population across Asia Pacific

Source: Wealth-X, World Bank, Worldometers, Knight Frank Research

What’s the draw? Both Hong Kong’s and Singapore’s reputations as a magnet for shopaholics and gastronomes are well known but aren’t the only attraction. Hong Kong is well situated as the major global financial centre of Greater China, with the added attraction of a gateway to the world’s capital markets.  The active nightlife and local arts scene has helped tie Singapore with Chicago for third place for lifestyle in Knight Frank’s City Wealth Index, behind only New York and San Francisco.

The Wealth Report 2018. Now in its 12th year, this annual publication examines price performance data for 100 global luxury property markets as well as the Global Wealth Distribution and Knight Frank’s City Wealth Index. Knight Frank will be holding large-scale forum sessions for the Wealth Report 2018 in Shanghai, Beijing and Shenzhen on June 9, 12 and 15, respectively. The event will bring together hundreds of ultra-wealthy customers.

Knight Frank invites Wealth Magazine to share insights into global wealth trends. YCG HOMES CO., LIMITED has partnered with Malaysian Developers Sycal Berhad and Golden Pavilion to present "Genting Park”,an eco-friendly residential project in Malaysia.Yingde Group, which specializes in immigration to Britain, will be sharing information on the lives of immigrants overseas. In addition, BE Education, which has been helping Chinese students enter their dream schools over the last 15 years will be analyzing recent trends and the choices faced when deciding to study abroad. Quality Group, a leading property developer in Cyprus and Greece, will introduce investment trends, government supported immigration schemes, tax advantages and policies for foreign investors in these two EU countries

For Wealth Report 2018 Chinese version:

https://kfcontent.blob.core.windows.net/research/1515/documents/zh-chs/201812-201812-5521.pdf

For Wealth Report 2018 English version:

http://www.knightfrank.com/wealthreport

http://www.knightfrank.com/resources/wealthreport2018/the-wealth-report-2018.pdf