Ultra-rich population in Asia-Pacific expected to rise the fastest in the next five years

This was a considerable increase compared to 2020, following a growth of only 2.4%. Globally, pandemic-related restrictions and lifestyle shifts have led to amassed savings and an increase in levels of wealth that has not been seen for years.

The rise of asset prices – from property markets to equity markets and luxury collectables – is one of the biggest factors that helped boost the fortunes of those wealthy enough to have such investment portfolios. The top five gainers for UHNWIs, in absolute terms, were the US, the Chinese Mainland, France, the UK, and Japan.

Our research reveals that, on average, just shy of two-thirds of UHNWI wealth is allocated to property. Just under a third of total wealth is held in principal and second homes, while the remainder is invested directly or indirectly into investment property.

In Asia-Pacific, despite having slower growth in 2021, its foothold as host to the world’s leading wealth hub will regain momentum in the next five years. The affluent continue to be bullish on the region’s trajectory, which can be witnessed by the forecasted growth in the UHNWI and HNWI population between 2021 and 2026, which will be the fastest across all regions.

As the wealth boom shifts east, the billionaire population of APAC will also rise quicker than the global average (33.7%), at 36.7% during the next half a decade. 
By 2026, more than a third of the world’s billionaires will be from the region, a proportion that has continued to rise. This reinforces that Asia-Pacific will be the engine of wealth creation in the 2020s. While, with gateway markets continuing their path of stable and resilient growth and developing markets playing catch-up at a very rapid rate.

The growth will entrench the region as the second largest wealth hub over the next five years. This will have long-lasting impact on residential prices and rental trends across many gateway markets in the region.  
According to the findings of Knight Frank's Global Buyer Survey 2021, health and mental well-being is the name of the game for APAC homebuyers in the post-pandemic world. Good air quality, green space, and good healthcare are top drawers’ location-wise, and property features that aid in making the work-from-home experience better for individuals will be sought after.

We expect capital appreciation to continue its sustained momentum. The lack of stock in the mainstream markets is not going to be alleviated in next 12 months, and the continued low interest rate environments will boost sale and rental activity. Appetite for home purchases will also see improvements from foreign buyers, as more travel restrictions are being lifted across APAC. Pent-up demand for properties in key safe-haven markets will result in further price growth.

The countries and territories forecast to see the largest proportional increase in their UHNWI populations between 2016 – 2026 

 
To read more about Knight Frank’s propriety Wealth Sizing Model, please download the latest edition of The Wealth Report.