Ultra-high net worth individuals are increasingly basing their buying decisions upon the opportunities they can gain from owning a luxury residential property, according to a new study by Wealth-X and Sotheby’s International Realty, “UHNW Luxury Real Estate Report: Homes as Opportunity Gateways.”
UHNW – ultra-high net worth individuals – are defined as those with at least $30 million in assets. Driving the “opportunity gateway” trend are international buyers seeking safe investment diversification. They also often engage in home purchases as part of a program to gain citizenship or residency status in foreign nations.
The report finds that there are 211,275 UHNW individuals worldwide, and they collectively hold nearly $3 trillion (U.S. dollars) in real estate assets. About 10 percent of their net worth is devoted to real estate assets, according to the study.
Among the report’s findings
- 12 percent of second homes purchased by UHNW individuals in emerging countries were located outside of the buyers’ country of residence.
- Chinese UHNW individuals make up the third largest share of foreign UHNW homeowners in the U.S., behind Canada and the United Kingdom.
- Twenty nations in Europe and the Americas now offer citizenship or residency programs to individuals willing to invest in domestic residential real estate.
“The research reveals trends that go beyond traditional motivations and help guide real estate investments that contribute to long-term wealth,” says Philip White, president and CEO of Sotheby’s International Realty Affiliates LLC. “It underscores the important role real estate plays in a larger strategy to build a valuable asset portfolio.”
Source: Wealth-X