A Deeper Look into the Knight Frank Wealth Report
Wealthy individuals in Kenya are said to invest a massive part of their wealth in real estate development. This statement is according to Knight Frank Wealth Report carried out in 2017. On average, about twenty eight percent of the total wealth a high net worth individual owns is set aside for investment in the real estate. The twenty eight percent does not comprise of second homes or primary residences.
How wealthy individuals allocate their wealth
The Knight Frank Wealth Report goes ahead to provide the average percentages high net worth individuals in Kenya allocate to several investments. Investments made in real estate precedes the amount of wealth allocated for personal business development which accounts for about twenty percent of the total wealth. These private business investments are closely followed by bonds, precious metals, cash, equities and many other similar investments; and they altogether account for about eighteen percent of their total wealth.
The survey above was administered to over nine hundred global leading wealth advisors and private bankers. Second homes and primary residences were excluded while calculating the individual net worth of the wealthy. These account for approximately fourteen percent of their wealth. Other smaller items such as art, cars and wine account for about eight percent of their wealth. This is for the wealthy individuals living in Kenya.
Casting our glance to global high net-worth individuals, the percentage proportion of their wealth allocations changed slightly compared to wealthy individuals in Kenya. Surveys show they only allocate a quarter of their wealth to investments. The amount they invest in real estates is about twenty-four percent of their wealth. This is closely followed by the amount allocated for investment in personal businesses which occupy roughly twenty-three percent of their wealth. Primary residences, second homes and other investment had a percentage share of sixteen percent, six percent and six percent respectively.
A more in-depth analysis of the Knight-Frank Report
The Managing Director of the Knight Frank Kenya, Mr Ben Woodhams said the wealthy individuals in Kenya have discovered how stable property investments are in the long-term.
The Wealth Report goes further to show nearly nine hundred individuals in Kenya became millionaires in 2016, substantially adding the number of the wealthy. For instance, those who have assets of above one million US dollars are about nine thousand four hundred with the majority of them living in Nairobi. The very affluent individuals own up to three homes on average in different locations globally.
What the high-net-worth individuals prioritize when buying properties
When buying properties, the wealthy prioritize the education of their children. Other reasons such as security, capital, opportunities and lifestyles follow suit.
In the properties sector, the wealthy have diverse interests on what is available. The most prominent proportion of people are looking to invest in residential, offices, retail, leisure and industrials followed in that order.
The majority of the high net-worth individuals in Kenya prefer a home locally. On the other hand, only about four percent of wealthy foreigners would dream of owning a home in Kenya.
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Information for this article is credited to Knight Frank available on the following page: