Real Estate Investor Magazine South Africa Real Estate Investor Magazine March 2018 | Page 59

N
ew World Wealth (NWW) recently published its
Global Wealth Migration Review, a report that inves-
tigates worldwide wealth and wealth migration trends.
As part of the report, key investment trends for HNWIs are
identified.
Hotel Residences
This trend is gaining traction in major cities around the world,
including in South Africa. In essence, you are bale to purchase
apartments/villas in existing hotels. This allows the owner to
ltake up permanent residence in a hotel, with all the same
services one would expect. According to NWW’s Andrew
Amoils, there are many reasons for the rising appeal of this
trend: “it appeals to those who travel a lot, your property and
facilities are maintained whether you’re there or not.” Further-
more, these residences offer good security and access to large
reception areas for meetings or events. And, of course, the
all-important room service.
GLOBAL WEALTH STATS
• Total private wealth held worldwide amounts
to approximately US$215 trillion.
• The average individual has net assets of
US$28,400 (wealth per capita).
• There are approximately 15.2 million HNWIs in
the world, each with net assets of US$1 million
or more.
• There are approximately 584,000 multi-mil-
lionaires in the world, each with net assets of
US$10 million or more.
• There are 2,252 billionaires in the world, each
with net assets of US$1 billion or more.
Residential Estates
By now, it should come as no surerise that residential estates
are popular. Not only do they offer enhanced security, but res-
idents are also offered access to amenities. Parks, playgrounds,
pools, horse riding and even skiing are offered in residential
estates around the world. One of the most popular types of
estates is of course the golf estate. South Africa ranks as one
of the countries with the highest number of golf estates, along
with Portugal, Spain, and the USA. Countries like New Zea-
land, Mauritius, Mexico, UAE, and the UK are also seeing
rapid growth in this sector.
Where to Look
The report indicates several drivers of wealth growth. Aspects
like safety, ownership rights, economic growth, low income tax
rates, ease of investment, and wealth migration are mentioned
as key factors that encourage growth in a country. Woman
safety is identified as one of the best ways to gauge a country’s
long term wealth growth potential. During 2017, the safest
countries in each region were as follows:
• Europe: Malta, Poland, Monaco, Iceland
• Asia Pacific: Australia, New Zealand, Sri Lanka, Japan,
South Korea
• Middle East: Israel, UAE
• Africa: Mauritius, Botswana, Namibia
From this, the report goes on to explain that countries like
Mauritius and Sri Lanka are both expected to perform well in
terms of wealth growth going forward.
Effect of HNWI Immigration
The inflow of HNWI is typically a sign of a healthy economy,
with Amoils commenting: “the only possible negative of tak-
ing in a wealthy person is that they can push property prices up
to levels that locals cannot afford.” He adds that Australia has
introduced measures to counter this, forcing foreigners to see
their properties to locals at a price they can afford.
Countries noted in the report as having had high inflows
of HNWI in the past year include Mauritius, Malta, Lux-
embourg, Cyprus, Portugal, and Spain. In contrast, countries
with large outflows of HNWI are typically experiencing larger
problems. HNWI typically leave a country for reasons relating
to safety, lifestyles, work opportunities, taxes, and standards of
living.
Amoils explains that HNWI are typically the first people
to leave a bad situation: “They have the means to leave, unlike
middle class citizens. If you look at any major country collapse
in history, it is normally preceded by a migration of wealthy
people away from that country.”
Global wealth is expected to rise by 50% over the
next decade, reaching US$321 trillion by 2027. This
will again be driven by strong growth in Asia. The
fastest growing wealth markets are expected to be:
• Sri Lanka: Safe country, good educational
standard and English speaking. Should benefit
from strong growth in the local technology,
manufacturing, real estate, healthcare and fi-
nancial services sectors (10 year wealth growth
forecast: 200%).
• India: Large number of entrepreneurs, good ed-
ucational system and English speaking. Strong
growth forecast in the local financial services,
IT, business process outsourcing, real estate,
healthcare and media sectors (10 year wealth
growth forecast: 200%).
• Vietnam: Emerging manufacturing hub of
Asia. Vietnam was the fastest growing wealth
market in the world over the past decade and
is expected to continue to grow strongly. We
expect Vietnam wealth numbers to be boosted
by strong growth in the local healthcare, manu-
facturing and financial services sectors (10 year
wealth growth forecast: 200%).
• China: Expected to benefit from strong growth
in the local hi-