Geneva - The super-rich will continue to flock to London,
despite the political and economic concerns around the UK’s intention to leave
the European Union, according to a report published on Wednesday by property
broker Knight Frank.
The number of ultra-wealthy people -- those with $30
million or more who private banks such as UBS Group and Citigroup love to court
-- living in the UK capital is expected to climb by 30 percent to 6 058 over
the next decade, the report showed.
That may ease doubts about the city’s appeal stemming
from an 80 percent slump in applications for investor visas last year,
following the introduction of anti-money laundering checks in 2014. Only 215
wealthy people were granted such visas, according to data published last week
by the UK government.
New York retains the top spot worldwide as expectations
for US economic growth override a period of uncertainty as the Trump presidency
takes shape, according to the Knight Frank report, which cited research
by Johannesburg-based consultancy New World Wealth.
“The forthcoming Brexit process will not result in an
outflow of wealthy individuals from the UK,” Andrew Amoils, head of
research at New World Wealth, said in the report. “Rather, it will mean that
existing high-net-worth individuals will be more likely to remain and indeed to
be joined by a growing list of new arrivals.”
Newcomers see the UK as the dominant center for business
and financial services in Europe, as well as being the only English-speaking
major economy in the region, according to the report. Traditional links with
the US, Canada, Australia and New Zealand will strengthen after Brexit, it
showed.
Read also: #Brexit fallout not just limited to London
London nonetheless languished in 92nd place in Knight
Frank’s ranking of luxury residential market performance included in the
report. Prices slid by 6.3 percent in 2016, mainly due to tax changes, although
sales volumes increased and sentiment improved at the end of the year, Knight
Frank said. Prime residential prices will remain unchanged in 2017, while the
cost of properties in cities such as Shanghai and Sydney will advance,
according to the report.
The number of ultra-high-net-worth individuals
globally rose to more than 193 000 in 2016, helped by stock-market gains. It
will exceed 275 000 by 2026, advancing most swiftly in Vietnam, Sri Lanka,
India and China, according to the report.
China will grow even more rapidly if it creates more
high-tech companies such as Huawei Technologies, Amoils said in a separate
email.
The number of billionaires will soar to 3 000 over the
next 10 years as faster-growing economies such as China and India create new
wealth, the report showed. The development of high-tech, financial services,
media and health-care industries in these countries is expected to help boost
private wealth for a 48 percent global increase in people with $1 billion or
more in net assets.
Asian cities led by Pune, Ho Chi Minh City, Hyderabad and
Bangalore are expected to be among those with the most rapid ultra-wealthy
population growth over the next 10 years. At the same time, Mumbai will
probably join Shanghai, Beijing, Singapore and Hong Kong in the top 10
locations for the super-rich.
Not all regions are expected to show such stellar growth
rates. The ultra-wealthy populations of Germany, France, Italy and Spain will
have lacklustre growth, with some affluent individuals expected to leave
continental Europe, according to the report.
Constraints include “a combination of rising taxes and
higher state-pension obligations and public health-care costs, and the loss of
high-skilled jobs to Asia,” Amoils said in the report.
The super-rich population in Nigeria fell 20 percent in
2016 due to “economic and political tensions” and isn’t expected to grow in the
next 10 years.
Ultra-wealthy migrants are expected to cluster around at
least half a dozen “safe haven” jurisdictions such as the United Arab Emirates,
Monaco, Israel and Canada, lured by fiscal and political stability and a better
quality of life, according to the report.
The Ras Al Akhdar development in the UAE’s Abu Dhabi, for
example, is already home to almost 400 ultra-high-net-worth individuals, Knight
Frank said.
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